First purchase: shares, First purchase: price, Second purchase: shares, Second purchase: price, Third purchase: shares (optional)
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How this calculator works
When you buy the same stock at different prices, your average cost is the total amount paid divided by the total number of shares. It is the price the stock must reach for the whole position to break even, before commissions and taxes. Buying more after a price drop lowers the average; this is often called averaging down.
Formula
- Average cost = (shares₁ × price₁ + shares₂ × price₂ + …) / (shares₁ + shares₂ + …)
- Total cost = sum of shares × price for each purchase
Worked example
100 shares at 50, then 50 shares at 40
- First purchase: shares
- 100
- First purchase: price
- 50
- Second purchase: shares
- 50
- Second purchase: price
- 40
Result46.67 per share
Average cost across 2 purchases totaling 150 shares.
Things to keep in mind
- Commissions and fees are not included; add them to the price paid if you want them reflected.
- Tax rules for cost basis (such as FIFO or specific-lot methods) differ by country.
- Figures are estimates for planning. They are not financial advice, and they ignore taxes and fees unless stated.
Frequently asked questions
How do I calculate average stock price?
Multiply shares by price for each purchase, add the results, and divide by the total number of shares.
What does averaging down mean?
Buying more shares at a lower price than your earlier purchases, which lowers your average cost per share. It also increases your exposure to the stock.
Is average cost the same as my tax cost basis?
Not necessarily. Tax authorities may require lot-by-lot methods such as first-in, first-out. Check the rules where you file.
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Results are estimates based on the values you enter and the published method shown above. They do not replace professional medical, financial or legal advice. Method reviewed October 7, 2026. About this site