How to attach a child diagram stereotype to a custom Stereotype

We are creating a set of custom stereotypes. What we would like to achieve is:

When an element is created based on a Custom Stereotype (by dragging it from the Toolbox onto a Diagram), the resulting Element has a child diagram of a certain type, present in our Diagram Profile

We've tried adding a composite diagram (a diagram from our diagram profile) as a child diagram to the custom stereotype. This, however does not seem to work.

What you need are the settings Default Diagram Type and Make Composite

Make Composite automatically creates a composite diagram when you create a new element of your stereotype.

The Default Diagram Type indicates which diagram that should be.

In this example that's a diagram defined in my own MDG with the fully qualified name KPI::KPI & Reporting Diagram