What is the Recommended Internet Speed For Trading?

To be successful when trading, you need an internet speed that is fast and reliable. This guide will recommend the minimum speeds needed for different types of trading. Remember that your results may vary depending on your computer and the software used. Always consult a professional if you are unsure what speed is best for you. So, without any lag, let's look at the recommended internet speed for trading and the ideal high speed internet connection for trading activities.

The Ideal Internet Speed For Trading

Traders require tools, including a high speed internet connection and trading software, to help ping ahead of hundreds of thousands of traders and perfectly time their buy and sell calls. Of course, most traders are already armed with all the tools required. Yet, one question pops up often, even among the pros of trading - "What is the ideal internet speed for trading?"

Why? Because the answer to this question isn't as straightforward as it seems. This is why many people still struggle with finding an internet speed they are satisfied with to carry out trading.

Certain factors must be considered to determine which high speed internet plans for trading are sufficient. They are:

• Ping
• Download speed
• Upload speed

Let's take a look at each in detail.

Ping

The first thing to focus on is the ping or ping time or latency. The ping time is the time required for a small data packet to be transmitted from your computer or laptop to an internet server and back.

Think of making a phone call. The ping or latency is how fast your call gets connected; the person on the other end receives your call and says, "Hello."

Ideally, you would want to have a ping of fewer than 50 milliseconds. Anything above this number will cause a delay in information being sent and received. And this will create a problem in buying and selling shares on the market.

So, don't forget to test your ping time on several sites such as speedtest or others for your high speed internet connection. If you get a low ping time, then great! Or else, you will have to look for another internet service provider.

Download Speed

Download speed is the amount of data that can be transferred or downloaded from the internet. The speed is calculated in terms of speed per second. For example, 25 Mbps (Megabits per second), 1 Gbps (Gigabits per second), or 512 Kbps (Kilobits per second).

Gbps > Mbps > Kbps

The faster your download speed, the quicker the information will be transmitted from the internet to your device. The ideal download internet speed for trading should be at least 40 Mbps. You can get a 40 Mbps plan for INR 470 per month. You can also get higher speed plans, such as the 75 Mbps plan, which costs INR 710 per month, or the 300 Mbps plan, which costs INR 1185 per month. You can check out the complete details for different internet plans for trading here.

If you can get a higher-speed connection, it would be great! Again, you can check the download speed on sites like speedcheck, speedtest, testmy, and others.

Upload Speed

The upload internet speed for trading is how fast you can send information from your device to the internet to perform certain tasks, such as placing buy or sell orders. The upload speed is calculated similarly to the download speed. i.e., in Kbps, Mbps, and Gbps.

Ideally, an upload speed of 40 Mbps is enough for trading purposes. Again, if you can get internet plans for trading with faster upload speeds, then it will be better.

So, there it is. The recommended internet speed for trading is as follows:

Download speed: 40 Mbps or more

Upload speed: 40 Mbps or more

Ping: 50 milliseconds or less

However, there is much more than these three factors to consider for determining the ideal internet plans for trading. Most people also have difficulties deciding between WiFi or an ethernet connection for trading. Here we answer the problem.

WiFi or Ethernet? Which to Choose

When it comes to stock trading, every millisecond counts. A loss of even a fraction of a second can mean the difference between a profitable trade and a losing one. For this reason, many stock traders place a premium on speed and reliability regarding their internet connection. So which is better for stock trading: WiFi or Ethernet?

Ethernet

Ethernet is a computer networking protocol that has revolutionised the way we connect to the internet. Ethernet allows for a much faster and more reliable connection than WiFi. Speed is especially important for stock traders, who need an uninterrupted connection to make trades quickly and efficiently.

Furthermore, Ethernet is less susceptible to interference than other types of connections, meaning that traders can be sure that their orders are being sent and received without delays. Ethernet is also very easy to set up and use, making it an excellent option for anyone who needs a reliable and fast connection.

In summary, Ethernet provides many benefits for stock traders, including speed, reliability, and ease of use. Investment firms and individual investors can benefit from this type of high speed internet connection.
 

However, Ethernet connections can be more expensive and difficult to set up than WiFi, so they may not be an option for everyone.

WiFi

WiFi allows you to trade from anywhere in the world, as long as there is an internet connection. This means you can take advantage of market opportunities without being tied to a physical location.

For example, you can use WiFi to carry out trading operations from your living room, garage, backyard, and bathroom. Because of these benefits, it is no wonder that WiFi has become the preferred choice for many new-age stock traders.

However, using WiFi can increase latency, increase operation time, and the connection gets weaker due to interference or if you move farther from the WiFi router.

Thus, ethernet seems to be the better option for trading. However, you can opt for a WiFi connection if you want flexibility and assurance of no connection issues. Ultimately, the best choice for stock trading depends on your individual needs and preferences.

In addition to a high-speed ethernet or WiFi internet connection, you must pay attention to other factors like the computer's processor, RAM, and software. This ensures that there are no obstacles in your trading activities and that you can stay on top. So, let's glance through them.

Other Factors to Consider For Trading

As mentioned above, having a seamless trading experience requires much more than a high speed internet connection. Here are the other things you need to consider.

CPU

The CPU or the processor plays a vital role in daily trading. The processor is the brain of the computer, and it determines how fast information can be processed to perform the best trading moves. You would want a lightning-fast processor with a high benchmark score. But, you will want to find out which processor you have.

If you use a Windows device, head to Start → System Information. There you'll find the processor information. It will be something like Intel Core i5 or AMD Ryzen 7.

Similarly, if you have an Apple device, you can click on the Apple logo on the taskbar and click on About this Mac to find the processor information.

Once you know the processer, the next step is finding the benchmark score. You can head to websites like CPUBenchmark to find the benchmark score. Ideally, the benchmark score for trading should be a minimum of 12,000. Again, the larger the score, the better it will be.

RAM

RAM stands for Random Access Memory. It is the part of a computer in which information is stored. The more programs you are running simultaneously, the more RAM you need. So, the higher the RAM, the better the device will perform and not hang while doing operations.

Thus, you would want a device with a high RAM. For trading, you would like to have a minimum of 16 GB RAM. Moreover, ensure that the RAM is of the latest version, DDR4 or higher.

Software

If you are using a Windows device, you would probably want to be running Windows 10 or higher. Similarly, if you have an Apple device, ensure you are running macOS Monterey.

Moreover, it would help if you were also prepared for unwanted situations during trading sessions. For instance, your internet connection might get disconnected, or your laptop battery might die midway.

So, here are the precautions you need to take during trading.

Precautions to Take During Trading

1. You need to set up an alternate high speed internet connection, such as a phone hotspot, in case the power drops or your internet connection drops. This ensures you always have access to the internet. Even if your power goes out or your primary high speed internet connection goes down, you can still trade without interruption. So next time there is a power outage or an issue with your internet service provider, you can rest assured that you won't miss a thing.
2. A laptop or computer can be a vital tool for any trader, allowing you to access real-time data, place trades, and monitor your portfolio. However, laptops and computers can also be unreliable, and it is not uncommon for them to experience technical difficulties or shut down without warning. That's why it's essential to have a backup laptop or computer that you can rely on to finish up your trading day activities.

Having a backup laptop or computer within reach will ensure that you can continue trading uninterrupted even if your primary device experiences unexpected problems. In addition, a backup laptop or computer will also give you peace of mind knowing that you have a reliable backup plan in place should your primary device fail.

1. Lastly, have only the necessary software and apps on your laptop or computer during trading hours. This minimises the chances of your machine becoming unresponsive due to many apps draining CPU, GPU, or RAM power. Moreover, it will help you focus and concentrate on the task at hand and make better-informed trading decisions.

Conclusion

There you have it. It would help if you had a high speed internet connection of at least 40 Mbps to download speed, 40 Mbps upload speed, and a ping time of fewer than 50 milliseconds, preferably over an ethernet connection. Moreover, the internet connection needs to be reliable at all times. If anything goes awry, you also need backups in places such as a second laptop or an alternate high speed internet connection.

Moreover, it is not only about the internet plans for trading or internet speed for trading. It would help if you also had a decent computer with the latest software and hardware to have a hassle-free trading experience.

We hope the information in the blog will help you assemble the perfect setup to make you the "Jack of all Trades."