How to use the stock average calculator
- Enter the quantity and price of each purchase; add a row for each buy.
- Enter the current market price to see your profit or loss.
- To average down or up, enter the price you would buy at and the average you want.
- Read the shares and money needed and your new average.
Average price formula
Average = (Q₁ × P₁ + Q₂ × P₂ + …) ÷ (Q₁ + Q₂ + …)
| Purchase | Quantity | Price | Cost |
|---|---|---|---|
| Purchase 1 | 50 | ₹1,480 | ₹74,000 |
| Purchase 2 | 30 | ₹1,320 | ₹39,600 |
| Purchase 3 | 20 | ₹1,210 | ₹24,200 |
| Total | 100 | ₹1,378 avg | ₹1,37,800 |
Shares to buy at ₹1,200 to reach a target average
n = Q × (A − T) ÷ (T − X)
With 100 shares at an average of ₹1,378, buying at X = ₹1,200 to reach a target T:
| Target average | Shares to buy | Money needed |
|---|---|---|
| ₹1,350 | 19 | ₹22,800 |
| ₹1,330 | 37 | ₹44,400 |
| ₹1,300 | 78 | ₹93,600 |
| ₹1,250 | 256 | ₹3,07,200 |
Lowering the average from ₹1,378 to ₹1,250 needs far more money than reaching ₹1,350. Check the trade costs with the brokerage calculator.
Frequently asked questions
How is the average price of a stock calculated?
Add up the cost of every purchase (quantity × price) and divide by the total number of shares. For example, 50 shares at ₹1,480, 30 at ₹1,320 and 20 at ₹1,210 cost ₹1,37,800 for 100 shares: an average of ₹1,378.
How many shares should I buy to reduce my average?
Shares needed = current quantity × (current average − target average) ÷ (target average − new buy price). The target must lie between the price you buy at and your current average; the closer it is to the buy price, the more shares you need.
Is averaging down a good idea?
Only if you still believe in the company. Buying more of a falling stock lowers your break-even but increases how much of your money rides on one share. Many investors cap any single stock at a set share of the portfolio.
Does my broker show the same average price?
Usually yes for delivery holdings, though some brokers include charges in the average and some adjust it for bonus issues and splits. Corporate actions change the quantity and price but not the total cost.
Which purchase is sold first for tax?
For shares held in demat form, the first-in first-out (FIFO) rule applies: the earliest shares bought are treated as sold first when you work out capital gains and the holding period.