Latency is the time delay for data to travel from the trader’s computer (or server) to the broker and back. In forex trading, latency is measured in milliseconds and directly affects execution speed. Low latency means orders reach the broker faster, reducing slippage. Since automated trading often requires split‑second decisions, hosting your robots as close as possible to the broker’s servers minimizes this delay. For example, every millisecond of extra latency can worsen trade fills over time. Forex VPS providers emphasize low-latency by locating servers near major exchange centers or broker data hubs.

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