Test environment

I would like to ask what kind of test/production environments you can suggest.

Let’s say, I have a Ubuntu 16.04 LTS system with nextcloud server.

To test new apps, new nextcloud versions on a separate system, I thought about setting up a second nextcloud instance on the same server using another virtual host. Of course, this would not help me to test OS updates, but it is a lot easier and cheaper as to run a second independent server.

Or do you have other suggestions?

Running a second one on the same machine should not be a problem. Good solution too.