BUSTED BY COSTS

Opening candle vs VWAP direction backtest: does it work after costs?

We coded the opening candle vs vwap direction strategy exactly as taught in a public video and ran it on NIFTY weekly, 2019-02 to 2026-10, with real charges. Our test: −₹80,000 after real costs. As taught with ATM weekly options, the rule lost about ₹80,000 per lot from 2019 to Oct 2026 after costs.

Net after costs: −₹80,000
Win rate: —
Worst drawdown: —
Reality Score: 18/100

The rules, as taught

On NIFTY futures 5-min candles, if the 9:25 candle closes above VWAP go long (buy ATM call), below go short (buy ATM put); exit when a 5-min candle closes back across VWAP or at 15:15. One trade a day. The video tested futures points without costs; we traded it with ATM weekly options.

What the video claims, and what we found

Claim: About +4,900 NIFTY points over 6+ years in futures, before costs.

In futures points we got +4,249 vs their +4,918 with nearly identical trade count (1,631 vs 1,628) and win rate (30.5% vs 30.6%); almost all of the edge came from 2020–22.

See the full results, charts and every trade

Questions people ask

Does the Opening candle vs VWAP direction strategy work?

Not as taught, once real charges are included. As taught with ATM weekly options, the rule lost about ₹80,000 per lot from 2019 to Oct 2026 after costs. Tested on NIFTY weekly, 2019-02 to 2026-10, after real costs. Reality Score 18/100.

What is the win rate of the Opening candle vs VWAP direction strategy after costs?

We did not count a per-trade win rate for this one; the net result after real charges was −₹80,000 with a worst drawdown of —.

How much did it make or lose in the backtest?

Our test: −₹80,000 after real costs. Over 2019-02 to 2026-10 (1 lot), the net after charges was −₹80,000 and the worst fall from a peak was —.

What exact rules were tested?

How was the Opening candle vs VWAP direction 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 or correction: write to [email protected] with the page link and what you believe is wrong. We will re-run the test and update the page.