Position Scaling & Pyramiding Calculator
Model multi-tier position additions and blended cost basis as winning trends develop.
How the Calculation Works
Read parameters and compute total exposure: multiply order quantity by contract unit multiplier.
Evaluate terminal return at the selected target price using strict financial mathematical boundary logic.
Deduct upfront capital commitments, taxes, or net debits to produce final net profit or loss realization.
Calculation Formula
Example Calculation
Entry 1: 100 @ ₹450; Entry 2 on breakout: 50 @ ₹470.
Total ₹68,500 invested across 150 shares sets new average at ₹456.67.
Assumptions & Parameters
- Pyramiding adds to positions exclusively when the initial entry is in profit.
Frequently Asked Questions
What is pyramiding in trading?
Adding to an existing winning trade as the price confirms the direction of the trend.
How is pyramiding different from averaging down?
Pyramiding adds to winners at higher prices; averaging down adds to losers at lower prices.
What is the golden rule of pyramiding?
Each subsequent add-on should be smaller than the previous position (e.g., 100 shares, then 50, then 25).
Why must stop-losses be adjusted when pyramiding?
Your average cost basis rises; you must trail your stop upward to ensure the total trade cannot turn into a net loss.
Does pyramiding increase portfolio risk?
Not if profits are locked in and the stop-loss on the combined position is moved above the break-even point.
When should pyramiding be avoided?
In choppy, range-bound markets where breakouts frequently fail.