https://thealgobench.com/approaches/costs--execution/Recent content in Costs & execution on The Algo BenchHugoen-INWed, 07 Oct 2026 00:00:00 +0000https://thealgobench.com/landmines/trading-the-untradable/Wed, 07 Oct 2026 00:00:00 +0000https://thealgobench.com/landmines/trading-the-untradable/<h2 id="the-trap">The trap</h2> <p>The NIFTY 50 index is a calculated number, not something you can trade. When a backtest buys and sells &ldquo;NIFTY&rdquo; at the index&rsquo;s own 1-min or 5-min high, low and close, it assumes fills at prices that may never have existed on any tradeable instrument. Real trades happen in futures, options or a <strong>synthetic future</strong> (a long call plus a short put at the same strike, which behaves like a future).</p>https://thealgobench.com/landmines/what-a-strangle-really-costs/Wed, 07 Oct 2026 00:00:00 +0000https://thealgobench.com/landmines/what-a-strangle-really-costs/<h2 id="the-trap">The trap</h2> <p>Using a rule-of-thumb cost per trade (&ldquo;call it 2 points a leg, each way&rdquo;) instead of a cost model built up from the actual charges and checked against real fills.</p> <h2 id="how-it-fools-you">How it fools you</h2> <p>The error can run either way, and both directions are expensive:</p>