"Order sent" — but the broker never took it
Our bot announced that an order had been sent. The broker had rejected it. The bot was reporting what it tried to do, not what actually happened.
· 2 min read
Rule-based investing and trading · Indian markets
Rule-based investing and trading, tested honestly, automated safely.
Algo simply means rules, followed every time. Rules keep you consistent; automation keeps emotion out of the decision. Here I share backtests, lessons and real-life experience from my own fully automated setup, including what didn't work. New to algo? Start here. Want to explore investing and trading strategies? See the strategies.
What's on the bench
Strategies
Does it actually work?
Rules, backtest, risks, pros & cons, and our verdict.
Open Strategies → LandminesIs your backtest lying to you?
The traps that make bad strategies look brilliant, and how to spot them.
Open Landmines → LaunchpadGet your first algo-bot right.
Build it step by step, and learn from real failures before they cost you.
Open Launchpad →The house rules
- Costs in. Brokerage, STT, exchange and regulatory charges, GST, stamp duty and slippage go into every result.
- Out-of-sample shown. Every strategy shows its untouched test period next to the period it was built on.
- No survivorship bias. Equity tests use point-in-time universes, including stocks that later dropped out.
- Failures published. Rejected and retired strategies stay on the record, and the reason they failed is explained.
- Old data only. Results use market data at least three months old. This is research, not a trade call.
Latest
Buying last year's losers: the NIFTY 500's worst performers kept losing
Buying the NIFTY 500’s 20 biggest losers of the past year and holding them for a year lost money: about −1% a year over 12½ years, against about +13% for the index, with an 80% fall along the way. Last year’s losers mostly kept losing.
· 5 min read
Lots or units? The same order, ten times the size
One broker API reads the order quantity as lots, another as units. The same code placed one lot on one account and ten on the other.
· 2 min read
Low volatility: hold the 30 calmest stocks in the NIFTY 500
Holding the NIFTY 500’s 30 least volatile stocks, rebalanced quarterly, passed all eight of our checks: about 15% a year after costs against about 13% for the index, with a −26% worst drawdown against the index’s −38%. The return edge came mostly before 2020.
· 6 min read
The server ran out of memory in the middle of an order
A small cloud server ran out of memory at the busiest minute of the day. The operating system killed the bot halfway through placing an order, and the restart nearly placed it again.
· 3 min read
Monthly momentum: hold the 15 strongest stocks until they fade
Holding the NIFTY 500’s 15 strongest stocks, and selling only when they drop out of the top 30, passed all eight of our checks: CAGR of about 22% after costs, against about 13% for the index. The catch is a −49% drawdown, deeper than the index’s.
· 6 min read