Herald of Perfection VS Prime Material Dragon

What would happen in this scenario? (Also general question to how it would resolve with the two mentions monsters in ANY scenarios)

Opponent controls 1 Chaos Sorcerer and 1 Prime Material Dragon, he activates Chaos sorcerer's effect to banish my Herald of perfection, I negated it, and he chains with Prime's effect, I chain with Herald's Discarding the only 2 cards in my hand, 2 fairy-types obviously. How does this resolve?

My opponent said that because PMD's effect is the same speed as HoP's, it can chain with it's effect, even though negated by HoP. What will the Monster Zone look like too, after everything has resolved. :S

you can continue the chain of negating each other until someone eventually runs out of discard materials. The last one activated will win then.

Oh okay, thanks. Solved.