Thread: Pyramiding

I have been looking at pyramiding as a strategy for a while now but have never really implemented it as a consistent trading plan as I am comfortable with the all or nothing approach, at least right now.

But I would be interested in others' experiences in pyramiding and ideas on how they would do it, general principles etc.

Just for clarity, when I say pyramiding I mean adding to an existing position once it has moved in your favour.

You are only speaking about scale In, but its possible to do Scale out too.

In my oppinion, it's only good idea, when you have a excelent trade location. If you historicaly have it, think about do that, but If you dont make a excelenten open trade (you entry and market don't go back more that a few ticks) That kind of strategy, works in front of you.

I do Scale in, but only in a swing trade. If I did a trade yesterday, and today it working to me, I scale in, always in the same directions, and looking for a good trade location. In the same day, is very hard to me do that, because It's possible that my first trade haven't moved enought... making me a big psicological presure.

About scale out... I tried before, but it isn't good idea for me.

Salu2.

Pyramiding isn't a strategy or a trading plan... it's part of one of these perhaps, but if someone asked you how you traded a market you could hardly just say 'I pyramid'... pyramid how? where?

Anyway, my advice would be the obvious advice - if you're going to do it, make sure your pyramid is the right way up, i.e. get your size on early; don't buy 1 lot and then buy 10 lots when you've got that trade nicely onside, as it will only take a small correction to wipe out the profit in your trade and make you get twitchy.

Scaling out is something I do often, as a bond trader I think is usually a decent idea to leave something on the table, especially on the long side, for those times when the market catches a big drive and doesn't stop; it's much harder to get back in, buying a market that's glued to its highs having sold out a couple of bps lower.

SL

Obviously pyramiding is not a complete trading plan, it is a part of it. Perhaps my wording was off, but you know what I meant.

You're right the advice is a bit obvious. I guess i was looking more for people to give an indication of how they pyramid. Like what triggers a new position, what do you do with your stop then, how much and how many times do you add. Not really giving anything away, just general principles.