Free calculator
Stock Average Calculator
Enter each purchase you've made and you get back your weighted average cost per share, your total invested, and the price the position needs to reach to break even.
Average cost per share
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Add your purchases to calculate.
- Total shares
- Total invested
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- Break-even price
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- Current value
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- Unrealised P&L
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Runs entirely in your browser. Nothing is sent or stored.
How the average is calculated
Your average cost is a weighted average, weighted by how many shares each purchase bought, so the size of each buy drives the result:
Average cost = Total amount invested ÷ Total shares owned
Say you buy 100 shares at $50 ($5,000), then 200 shares at $35 ($7,000). You own 300 shares and have spent $12,000, so your average is $40.00, not $42.50, which is what you would get by averaging the two prices. The second purchase was twice the size, so it pulls the average twice as hard.
Averaging down: when it helps and when it hurts
Lowering your average cost sounds unambiguously good. It is not, because it comes with a cost that is easy to miss: you now own more of something that is falling.
Before adding to a losing position, answer these honestly:
- Would I buy this today at this price if I owned none of it? If the answer is no, the position has become about being proved right.
- Has the reason I bought changed? A broad market selloff is different from a collapsing balance sheet.
- What does this do to my concentration? Averaging down repeatedly turns a diversified portfolio into a bet on one name.
- Where is the point I stop? Decide it now, in advance, and write it down.
The break-even arithmetic
Losses and the gains needed to recover them are not symmetrical, and the gap widens fast:
| Loss from cost | Gain needed to break even |
|---|---|
| 10% | 11.1% |
| 25% | 33.3% |
| 50% | 100% |
| 75% | 300% |
| 90% | 900% |
This table is the entire argument for cutting losses early, and it is why a position sizing discipline matters more than picking good entries. Recovering from a 10% loss is routine. Recovering from a 75% loss requires a quadruple.
Frequently asked questions
How do you calculate the average price of a stock?
Add up the total amount of money you spent across all your purchases, then divide by the total number of shares you hold. It is a weighted average, which means a large purchase moves your average a great deal more than a small one made at the same price.
What is averaging down?
Buying more shares of a stock you already own at a lower price, which reduces your average cost per share. It lowers the price at which you break even, but it also increases your total exposure to a position that is currently moving against you.
Is averaging down a good strategy?
It depends entirely on why the price fell. Adding to a quality company during a broad market selloff is a perfectly legitimate investing decision. Adding to a position because you cannot face accepting a loss is an emotional response wearing the costume of one, and it is how small losses turn into account-ending ones.
What is the difference between averaging down and dollar-cost averaging?
Dollar-cost averaging means investing a fixed amount on a fixed schedule whatever the price does, which makes it planned and mechanical. Averaging down means adding specifically because the price dropped, which makes it a reaction. The arithmetic looks similar. The psychology and the risk do not.
Does this calculator account for fees and taxes?
You can include commissions by adding them to the cost of each purchase. Taxes are left out, since they depend on your jurisdiction, your holding period and your account type, and in any case they fall due when you sell.