Do you have a disaster plan for your trading setup and your trading computer? Because one power outage or internet drop could cost you thousands of dollars.
Let’s talk about one of the most overlooked systems of a serious trading setup, and that is your backup plan.
If you're trading without protection from power outages or power surges, you are walking a tightrope without a safety net.
Let’s break it down here.
Surge Protectors
First up, surge protectors. I know what you're thinking: “Eddie, come on. I've got search protectors on my TV and my computer. I'm good.”
But here's the problem. Most traders forget to protect every single wire that's coming out of the wall, not just the power plug.
I live in South Florida, which is the lightning capital of the U.S., and I can't tell you how many times I've personally lost routers and modems from lightning strikes.
I'm talking about fried beyond repair. Why? Even though my computer was protected, the coax cable and the fiber optic lines going into my modem weren't. Boom! Lightning hit, and my network was toast.
If it comes out of the wall: cable, ethernet, or phone line, it needs to run through a surge protector before hitting your equipment. Non-negotiable.
Power Outages
Now let's talk about power outages. If you've ever had multiple trades open and suddenly your power goes out, you know that sinking feeling. You're completely blind to the market and you can't close or manage your positions.
This can cost you real money. That's why you must have a battery backup system, also called a UPS, an uninterruptible power supply.
But don't just plug everything into one backup and hope for the best.
My Recommendation
Here's what I recommend and what I personally do.
Battery backup #1 - I have my trading computer plugged in.
Battery backup #2 – I have my monitors, at least two of them.
Battery backup #3 – I have my networking gear: my modem and my router.
When the power goes out, I have about 10 to 15 minutes of juice. Just enough time to close out trades and shut everything down safely.
Bonus Tip
Here's a bonus tip. Get in the habit of testing your backup every couple of months. Unplug the power cable to the UPS and make sure the system stays up and running.
Don't assume it’s going to stay up and running, verify it's going to stay up and running.
Connected Equipment Warranty
Also, here's something most people don't realize.
Most UPS manufacturers offer a Connected Equipment Warranty. That means if your computer or your monitor gets damaged while plugged into that UPS and the UPS fails to protect it. They'll reimburse you for the repair or the replacement cost.
Just make sure you're using a reputable brand like Cyber Power or APC and follow their surge protection rules. So don't just think of your UPS as backup power. It's also a layer of insurance.
Internet Backup
Next, let's talk about your internet backup.
Even if your power's fine, your internet provider can still go down, and when it does, you're stuck unless you've got a backup.
Now, I always recommend having a secondary internet connection, and that could be a hotspot from your phone, a dedicated 5G hotspot device, or even a second broadband provider. That's what I have here.
Speed isn't the main thing here. You just need a way to stay connected to your trading platform in an emergency.
Backup Computer
Now, let's go one level deeper, a backup computer.
What if your main system totally crashes? You spill coffee on it, your SSD fails or something happens. If you don't have a secondary trading computer, you're gambling with your entire trading account.
You don't need a monster machine, just a functional backup with a platform pre-installed and ready to go. It can be a laptop. Keep it updated. Keep it plugged into the power. Have it on standby.
My final piece of advice is your cell phone. Make sure you have your broker's mobile app installed on your phone, you know how to log in, you know how to use that authenticator app, and you can be ready to trade in a minute's time.
This is your last line of defense.
If everything else fails: power, computer, or internet, you should still be able to log in on your phone and set stop orders or exit positions. This simple step has saved traders countless times, including me.
Conclusion
To wrap it up. If you're serious about trading, you must be serious about your backup game. It needs to be right on point.
Here is a quick summary of what we talked about:
- You want surge protection for every single line that's coming out of the wall.
- I would recommend multiple battery backups.
- Have a backup internet connection. It can be a hotspot. It can be a secondary broadband connection.
- A backup computer.
- Mobile access to your trading account.
Set this up and you will sleep a whole lot better.
If you found this information helpful, you like this video, do me a favor, give it a like, subscribe, and go ahead and get our Complete Guide to Trading Computers.
