Hello KC,

I am fairly new trading, less than one year. But from what I have read the proper terminology is tearing (there may be other names for this) which means if you have one contract you add another. Pyramiding is if you have one contract and you add two, and then add four, and so on. Tearing is adding one contract at a time. True pyramiding is extremely dangerous and from what I have read it is a fast way of losing your account.

I think you are talking about tearing. I have tried this in paper trading somewhat successfully, but with the small account I have, I have been reluctant to do this with real money. While when you have enough profit on your first contract to cover losing on your second contract it works very well as long as the market is going in your direction. But keep in mind if the market reverses on you, your losses will be double.

It is this double edged sword that has made me reluctant to try this with my account capital at less than $10,000.

More experienced traders may have a different take on this.

Becky