• Skip to primary navigation
  • Skip to content
  • Skip to footer
StoneX®

Trade Futures, Spreads and Options with Confidence.

Top Navigation

  • Open a Futures Account
  • Sign Up
  • Log in
  • 1.800.800.3840

Primary Navigation Menu

  • About
    • Who We Are
    • Services
    • Risk Disclosure
    • COVID-19
  • Trade
    • Broker-Assisted
    • Self-Directed / Online
    • Request Pricing
  • Hedge
    • Ag Marketing Plan
    • WASDE Analysis
    • Grain Resources
    • Livestock / Dairy Resources
    • Request Pricing
  • Invest
    • Automated Strategies
    • Managed Futures
    • Request Pricing
  • Advisories
    • GENERAL / FUNDAMENTAL
      • DT Newsletter
      • Insider Market Advisory
      • Turner’s Take Newsletter & Podcast
    • TECHNICAL ANALYSIS
      • The Cullen Outlook
      • Data Feed Trade
      • Jarboe Trading Journal
      • Trade Spotlight
    • AG MARKETING
      • Cattleman’s Advisory
      • Technical Ag Knowledge
      • Turner’s Take Ag Marketing
    • THIRD-PARTY RESOURCES
      • CFRN
      • Moore Research Center, Inc. (MRCI)
      • OptionWorks®
      • TASMarketProfile.com
  • Education
    • CME Group Resource Center
    • CME Group Offers
    • Small Exchange Resources
    • Guides
    • Frequently Asked Questions
    • Order Entry Handbook
  • Blog
    • Futures 101
    • Ag Marketing
    • Tips & Strategies
    • Trading Advisories
  • Resources
    • Trading Software
    • Quotes and Charts
    • Futures Calendars
    • Contract Specifications
    • Margin Requirements
    • Futures Calculator
  • Accounts
    • Apply
    • Access My Account
    • Funding
  • Contact
 

How To Optimize Your Commodity Trading Platform

October 24, 2019 by Daniels Trading| Tips & Strategies

In the contemporary futures marketplace, the commodity trading platform is an integral part of conducting day-to-day business. It is the trader’s gateway to the markets, a software lifeline that links participants and brokers to the exchange. Ensuring that the platform is in peak operating condition is a key part of competent trading.

So how can this task be accomplished? The answer lies in addressing one subject: latency. If you are going to trade commodities online, you must be aware of latency and work to reduce its negative effects.

Addressing Latency

Latency refers to any delay in the time it takes for a trader to interact with the market. Latency impacts every facet of online futures trading: the flow of pricing data, order entry, and trade execution. To optimize a commodity trading platform, one must mitigate latencies.

When it comes to latency in the markets, there are two types: those local to the trader and those that exist in the market infrastructure. Unfortunately, issues that originate at the exchange, brokerage, or internet provider can’t be fixed by the trader. However, there are three tools an average retail participant can use to promote strong commodity trading platform performance: maintenance, connectivity checks, and broker evaluation.

Maintenance

Among the greatest attributes of modern software trading platforms is that they are user-friendly. One does not need a PhD in computer science to troubleshoot most problems that arise. Many of the issues that plague performance may be solved through taking a few basic measures:

    • Update Software: Making sure that your operating system and trading software are up to date eliminates any glitches or bugs that may plague older versions.
    • Address Security Conflicts: Firewalls or third-party security providers can place barriers on data flow. If your CPU is equipped with these features, it is critical that they are set up to allow market data to be sent and received unfettered.
    • Perform Hardware Maintenance: Though it is unnecessary to regularly purchase top-of-the-line equipment, it is also important to maintain what you already have. This is accomplished by regularly defragmenting your hard drive, compressing secondary data files, and ensuring that there is enough RAM available to operate multiple applications simultaneously.

Our trading platform allows you to access the global futures market with enhanced features, one-click trading, no fees, and more! Start your free 14-day trial today.

Connectivity Checks

An online trader’s ability to access the market relies upon internet connectivity. If your internet connection is slow or inconsistent, then you are at a competitive disadvantage.

Unfortunately, there is very little that you can do to improve an inherently bad connection. However, all is not lost. After identifying the degree of connection latency, you can adopt strategies that don’t rely on speed to succeed. Here are a couple of tests that anyone can conduct to gauge the strength of a connection to the market:

  • Speed Tests: A simple online speed test will give you the download/upload rates for your connection. There are no hard rules or specs for speed, but faster is always better. Also, upload speeds are more important than download speeds. This is a key point because trade execution often depends upon how fast orders can get to the market.
  • Ping Tests: Periodically performing ping tests between your CPU and broker/exchange servers is a great way to monitor connectivity. A ping test can be your barometer of how fast data is flowing to and from the exchange. If there is a tremendous variance in day-to-day ping rates, then relatively rare issues such as data bottlenecks may exist.

It is important to remember that fast upload speeds and pings trump download speeds. Though a certain amount of bandwidth is needed to fuel the commodity trading platform, the ability to send data to the exchange is crucial to performance.

Broker Evaluation

Perhaps the most difficult area in which to identify latency is in the broker’s infrastructure. In some cases, inefficiencies exist completely unbeknownst to the trader. These items can compromise the effectiveness of a commodity trading platform without anyone being the wiser.

Fortunately, there are two areas where broker-related latencies become evident:

  • Order Routing: Where orders are stored as they wait to be executed is a key element in trade-related latency. Orders are commonly held in two fashions: client-side or server-side. Server-side is ideal because orders rest in a queue at the exchange instead of locally on traders’ PCs.
  • Experience: If fills are consistently poor over time, then something is likely amiss. Monitoring slippage rates over weeks and months is a solid way of evaluating a broker’s aptitude.

A periodic and honest broker evaluation is an important aspect of maintaining adequate performance. Though perfection is impossible, consistently poor fills and significant slippage are signs that a broker’s technological infrastructure is inadequate. If this is the case, then it may be time to investigate alternatives.

Are You Searching for a Robust Commodity Trading Platform?

If you are a commodity futures trader in search of an ideal path to the markets, then the platforms at Daniels Trading are worth a look. Featuring its flagship software suite dt Pro, Daniels has everything you need to stay on the technological lead lap. For a closer look at dt Pro, sign up for your free 14-day trial today.

Read our guide, Futures Trading: Technical Analysis for Beginners

Filed Under: Tips & Strategies

About Daniels Trading

Daniels Trading is division of StoneX Financial Inc. located in the heart of Chicago’s financial district. Established by renowned commodity trader Andy Daniels in 1995, Daniels Trading was built on a culture of trust committed to a mission of Independence, Objectivity and Reliability.

Risk Disclosure

The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided. References to over-the-counter (“OTC”) products or swaps are made on behalf of StoneX Markets LLC (“SXM”), a member of the National Futures Association (“NFA”) and provisionally registered with the U.S. Commodity Futures Trading Commission (“CFTC”) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ (“ECP”) and who have been accepted as customers of SXM. StoneX Financial Inc. (“SFI”) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI does business as Daniels Trading/Top Third/Futures Online. SFI is registered with the U.S. Securities and Exchange Commission (“SEC”) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Adviser. References to securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to exchange-traded futures and options are made on behalf of the FCM Division of SFI.

Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.

© 2023 StoneX Group Inc. All Rights Reserved

Subscribe To The Blog

Footer

Site Navigation

  • Frequently Asked Questions
  • About Us
  • Customer Reviews
  • Contact Us
  • Futures Blog
  • Open a Futures Trading Account
  • Media Resources
  • Fund Your Account
  • Legal Notices

Contact Us

StoneX Financial Inc.
Daniels Trading Division
230 South LaSalle Suite 10-500
Chicago, IL 60604
+1.312.706.7600 Local / Int'l
+1.800.800.3840 Toll-Free
+1.312.706.7605 Fax

Connect with Us

Trustpilot
Risk Disclosure

The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided. References to over-the-counter (“OTC”) products or swaps are made on behalf of StoneX Markets LLC (“SXM”), a member of the National Futures Association (“NFA”) and provisionally registered with the U.S. Commodity Futures Trading Commission (“CFTC”) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ (“ECP”) and who have been accepted as customers of SXM. StoneX Financial Inc. (“SFI”) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI does business as Daniels Trading/Top Third/Futures Online. SFI is registered with the U.S. Securities and Exchange Commission (“SEC”) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Adviser. References to securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to exchange-traded futures and options are made on behalf of the FCM Division of SFI.

Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.

© 2023 StoneX Group Inc. All Rights Reserved

  • Risk Disclosure
  • Privacy Policy
  • California Residents Privacy Notice
  • Terms of Use
  • Back to top