HI All I am newbie to trading and it is not really clear what does it mean 'beat the VWAP'. I don't understand the math I need to do in order to understand whether I "beat" it or not. I have the following 2 doubts: 1. Is this meaning that the Average Prices of ALL of MY trades ( both BUY and SELL order executed ) I do during the day must have a better price of the VWAP calculated at the end over all of the trades of the day? So in terms of formula P_avg >= VWAP_end_of_day 2. Maybe I am confused, but should I make a distinguish between price for BUY order vs SELL order? Let me be more clear: # If a Buy order is executed, the price should be LOWER than the VWAP of the day # If a Sell order is executed, the price should be HIGHER than the VWAP of the day So in terms of formula P_BUY_avg <= VWAP_end_of_day P_SELL_avg >= VWAP_end_of_day It is probably a silly concept , but I am really newbie. Regards Mnstn
The term "beating the VWAP" refers to executing a large order at a price that is better than VWAP. In other words, you want to have an average buying price that is below the VWAP, and an average selling price above the VWAP.