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pyramid strategy

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  #1  
Old 3rd October 2004, 05:17 PM
hmp hmp is offline
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Default pyramid strategy

can anybody explain pyramid strategy in trading? i also like to know how to double once proffit while exiting from one position and starting anoher position. its very usefull strategy in the game of trading which most of expert traders using.
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Old 4th October 2004, 08:13 AM
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Default Re: pyramid strategy

Quote:
Originally Posted by hmp
can anybody explain pyramid strategy in trading? i also like to know how to double once proffit while exiting from one position and starting anoher position. its very usefull strategy in the game of trading which most of expert traders using.
I came to know of the pyramid trading strategy when I subscribed to the futures trading newsletter from tradingpicks.com They recommend this strategy.

I use this strategy to trade the nifty futures and the results are fantastic.

Pyramid Trading as the process of using profit generated from an existing position to acquire additional positions.

This results in a "doubling" of your position during each pyramid iteration. By using a sensible approach to "manage" risk, it is possible to rapidly achieve exponential gains.

The signals are generated by the newsletter, so I just have to follow the signals and add positions only in the "direction of the profitable trend". The profits from my first trade partly pays for the second and so on... I like this strategy because it provides a more comfortable trading situation and gives me confidence of trading.

have any further questions then let me know.
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Old 4th October 2004, 06:21 PM
hmp hmp is offline
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thanks andy for information. pl let me know which scheme of tradingpicks.com u subscribed. i also want to join the scheme. in the meanwhile can u produce the article published by them?
with regards
hmpatil.
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Old 4th October 2004, 07:07 PM
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Default Re: pyramid strategy

Quote:
Originally Posted by hmp
thanks andy for information. pl let me know which scheme of tradingpicks.com u subscribed. i also want to join the scheme. in the meanwhile can u produce the article published by them?
with regards
hmpatil.
I have subscribed to the short term trading newsletter for stock and index futures newsletter.stock and index futures newsletter

This is not exactly an article a way or method of trading they recommend.

For example if I have capacity to trade 5 nifty contracts. On the 01st signal I buy only one. The nifty index moves up in my favour. After some time the newsletter gives nother buy signal. I am still holding on to the 01st contract and then I buy another one. I keep doing this and the paper profits of the initial contracts act as a cushion for the next trade. I keep doing this until the stoploss is triggered or I exhaust my entire 5 contracts.
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Old 5th October 2004, 12:13 AM
hmp hmp is offline
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Default Re: pyramid strategy

thanks a lot dear andy. only one question. one must be required to keep sufficient margin(atlest for 5 nifty contracts) with broker to carryforward the position. am i right?
with regards
hmp
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  #6  
Old 5th October 2004, 12:09 PM
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Default Re: pyramid strategy

Quote:
Originally Posted by hmp
thanks a lot dear andy. only one question. one must be required to keep sufficient margin(atlest for 5 nifty contracts) with broker to carryforward the position. am i right?
with regards
hmp
Yes you need sufficient money for 3-5 contracts. But if the trend works in you favour and as the futures positions are marked to market every day the profits get credited to you account so in the end you do not really need all the money for all the contracts as the profits from your previous position pays for the new contracts you enter.

I found a good example for NSE Nifty trades on the Nifty Futures Trading Signal and NSE Nifty Futures Trading Performance Summary using the Short Term Futures Trading Newsletter
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