Share Average Price Calculator

Weighted Average Price Formula:

\[ \text{Average Price} = \frac{\sum (\text{Shares}_i \times \text{Price}_i)}{\text{Total Shares}} \]

Weighted Average Price:

Total Shares:

Total Investment:

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1. What is Weighted Average Share Price?

The weighted average share price calculates the average price paid for shares when purchased at different prices. It accounts for the number of shares bought at each price level, giving more weight to purchases with larger share quantities.

2. How Does the Calculator Work?

The calculator uses the weighted average formula:

\[ \text{Average Price} = \frac{\sum (\text{Shares}_i \times \text{Price}_i)}{\text{Total Shares}} \]

Where:

\( \text{Shares}_i \) — Number of shares purchased in transaction i
\( \text{Price}_i \) — Price per share paid in transaction i (USD)
\( \text{Total Shares} \) — Sum of all shares purchased

Explanation: The equation calculates the total amount invested divided by the total number of shares owned.

3. Importance of Average Price Calculation

Details: Knowing your average share price is crucial for determining your break-even point, calculating unrealized gains/losses, and making informed decisions about when to sell.

4. Using the Calculator

Tips: Enter your share purchases as comma-separated values (e.g., "100,50,200") and corresponding prices in the same format (e.g., "10.50,12.25,9.75"). The calculator will compute your average price, total shares, and total investment.

5. Frequently Asked Questions (FAQ)

Q1: Why use weighted average instead of simple average?
A: Weighted average accounts for the size of each purchase, giving more importance to larger transactions that have a bigger impact on your overall position.

Q2: How does this help with investment decisions?
A: Knowing your average cost basis helps you determine your profit/loss at current prices and make informed selling decisions.

Q3: Should I include fees in the price?
A: For most accurate cost basis, include any transaction fees in your purchase prices (divide total cost by number of shares).

Q4: What if I've sold some shares?
A: This calculator is for purchases only. For accurate cost basis after sales, you need to track using FIFO, LIFO, or specific identification methods.

Q5: Can I use this for crypto investments?
A: Yes, the same principle applies to any asset purchased in multiple transactions at different prices.