National Instruments ENET-232 Series, Manual

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Why do loopback tests of large data transfers
sometimes have problems?
In a typical loopback test, an external wrap plug is used to loop back
transmit signals to receive signals. In this configuration, data transmitted
is read back on the same serial port to test port communication.
Loopback programs often perform this data transfer using a single write
followed by a single read, and thus rely on driver software and serial
hardware buffering to hold the data between the two function calls.
However, these buffers are of finite size, and thus any data transfer that
exceeds the buffer size either times out, blocks (due to flow control), or
drops data. This behavior is a result of the test design and does not
represent a hardware or driver error. Buffer sizes vary between operating
systems and hardware, but typically range from 4–8 KB in size.