Work out the average cost per share across several purchases at different prices.
The average is weighted by share count, so a large purchase at a low price pulls it down more than a small one. Comparing it with the simple average of the prices shows how much the weighting matters. Average cost is the break-even price and the basis for any capital gains calculation, so an unweighted average will give the wrong answer to both.
Stock Average Cost
Average cost = total amount invested ÷ total shares held
Average cost = total amount invested ÷ total shares held The average is weighted by share count, so a large purchase at a low price pulls it down more than a small one. Comparing it with the simple average of the prices shows how much the weighting matters.
Average cost is the break-even price and the basis for any capital gains calculation, so an unweighted average will give the wrong answer to both.
This calculator takes 6 inputs: Shares in purchase 1, Price in purchase 1, Shares in purchase 2, Price in purchase 2, Shares in purchase 3, Price in purchase 3. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.