BUSTED BY COSTS

NIFTY fade small gap-ups backtest: does it work after costs?

We coded the nifty fade small gap-ups strategy exactly as taught in a public video and ran it on NIFTY futures, 2017-01 to 2026-10, with real charges. Our test: −₹4.07 L after real costs. As taught on futures, 1 lot lost about ₹4.07 L after real costs over ~10 years; before costs it was only +₹4.9k.

Net after costs: −₹4.07 L
Win rate: 51.2%
Worst drawdown: −₹4.07 L
Reality Score: 10/100

The rules, as taught

If NIFTY opens 0.25–0.50% above the previous close and the first 5-min candle does not touch that close, short at 09:20. Target = previous close, stop = same distance above, exit 15:15.

What the video claims, and what we found

Claim: A clear positive edge (about +46R) on the spot index over ~6.5 years.

On the spot index we reproduce the edge (+58R vs their +46R). On futures it shrinks from ~7 to ~1.6 points a trade because of basis moves, against ≈15–20 points of costs.

See the full results, charts and every trade

Questions people ask

Does the NIFTY fade small gap-ups strategy work?

Not as taught, once real charges are included. As taught on futures, 1 lot lost about ₹4.07 L after real costs over ~10 years; before costs it was only +₹4.9k. Tested on NIFTY futures, 2017-01 to 2026-10, after real costs. Reality Score 10/100.

What is the win rate of the NIFTY fade small gap-ups strategy after costs?

51.2% of 469 trades made money after real charges in our test (2017-01 to 2026-10). A high or low win rate alone says little; the net result was −₹4.07 L with a worst drawdown of −₹4.07 L.

How much did it make or lose in the backtest?

Our test: −₹4.07 L after real costs. Over 2017-01 to 2026-10 (1 lot, historical lot sizes), the net after charges was −₹4.07 L and the worst fall from a peak was −₹4.07 L.

What exact rules were tested?

If NIFTY opens 0.25–0.50% above the previous close and the first 5-min candle does not touch that close, short at 09:20. Target = previous close, stop = same distance above, exit 15:15.

How was the NIFTY fade small gap-ups backtest done?

On 1-minute exchange data since 2017, signals filled at the next minute's open, with real broker charges, STT, exchange fees, SEBI fee, stamp duty and GST, and the lot size of each date. Rules exactly as taught; gaps we had to fill are stated. Full method on our How we test page.

Run it yourself — coming soon

These rules use features our public backtester can't express exactly yet, so we won't pre-fill an approximation. Build your own idea in the meantime.

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Important

These are educational backtests of publicly taught rules, not investment advice or a recommendation to trade. Algrow is not registered with SEBI as an investment adviser or research analyst. Past results, real or simulated, do not predict future results; option trading can lose more than the premium or margin used.

Method: 1-minute historical exchange data; signals filled at the next minute's open unless the rules say otherwise; real broker charges, STT, exchange fees, stamp duty and GST; lot size as on each trade date. Where a video leaves a rule open, the assumption we made is stated. We test only the rules as presented and paraphrase the claim; watch the video for the creator's full explanation. Full method: how we test.

Creators can request a review, correction or takedown using this form. We review every request within 7 days, re-run the test where needed and update the page.