To Pyramid Out

That is, you want to take partial profits, but keep some money on the table.

For example, I know of a trading system in which you buy 3 contracts at the same time. The first contract is exited by use of a take profit, perhaps 10 pips above the entry price.

The second contract has a trailing stop-loss.

The third contract is exited when the reverse position is taken (the system was mirrored, and if in a long position, this contract would be exited when the rules for going short were met).

It's important to realise that such rules essentially create multiple trading systems, not just one. You have trading system #1 where you use a 10-pip take-profit, trading system #2 where you use a trailing stop-loss, and trading system #3 where you exit at market when opening a trade in the opposite direction.

And that's exactly how to set it up in ATM - make multiple trading systems instead of one. They'd be an exact copy of each other, except that the trade management rules would differ.

Because every system would have the same entry rules and values, they would all enter a trade at the same time. But with the trade management rules being different, they will exit at different times.

See also:

• To pyramid in