Its a risk mgmt / money mgmt strategy. It's not a magic pudding formula churning out profits from any crazy stock investment. If the stocks a dud and travels sideways or down no amount of creative trading will make decent returns unless perhaps you short it (trade it to fall). Hone your FA skills to find high probability and potential large % gain trades in hot sectors, ones with enormous upside potential . Then apply pilot /pyramid strategy to minimize trade risk whilst maximize exposure upside.
