Calculator Panel
Calculation Ready
Enter your values above and click Calculate.
What This Calculator Does
This calculator determines weighted average cost parameters across multiple asset positions to establish cost bases.
How to Use This Calculator
Input shares and share purchase prices for up to three positions. Click Calculate to view total cost basis and average unit cost.
How the Calculation Works
The underlying math engine processes your inputs using exact formulas. This systematic approach ensures professional, institutional-grade calculation precision:
Mathematical Formula
Formula Legend:
- · Units1, Units2, Units3 = Total units/shares held in each asset class.
- · Cost1, Cost2, Cost3 = Unit purchase prices for those asset classes.
Practical Example
Suppose your portfolio contains 100 shares of Stock A (bought at $50) and 200 shares of Stock B (bought at $20):
Step-by-Step Mathematical Walkthrough:
- 1 Calculate cost for Asset 1: 100 shares * $50 = $5,000.
- 2 Calculate cost for Asset 2: 200 shares * $20 = $4,000.
- 3 Aggregate total cost and total shares: $9,000 total cost basis; 300 total shares.
- 4 Divide total cost by total shares: $9,000 / 300 shares = $30.00 average cost per unit.
Important Assumptions & Notes
- All assets are denominated in the same currency scales.
Common Mistakes or Considerations
- Forgetting to include broker fees when entering unit purchase costs.
Frequently Asked Questions
What is aggregate average cost?
The weighted average purchase price of a stock or asset position across multiple buy-in transactions made at different market prices.
How is the average cost of a portfolio calculated across multiple buy-in tiers?
By summing the total dollar costs of all share purchases (including commissions) and dividing that aggregate sum by the total number of shares owned.
Why is tracking average cost critical for calculating capital gains?
Your average cost is your cost basis. Subtracting this from your final sale price determines your taxable capital gain or loss.
What happens to my average cost if I sell part of my position?
In an average cost model, selling part of your position reduces the number of shares but does not alter the average cost basis of the remaining shares.
What is the difference between FIFO and average cost basis for tax reporting?
FIFO (First-In, First-Out) assumes the oldest shares are sold first. Average cost blends all purchase prices. Mutual funds often allow average cost, while individual stocks typically use specific identification or FIFO.