Stock Average Price Calculator
Two Purchase Average
Dollar Cost Averaging Plan
Formula
Average Cost = Total Amount Invested / Total Shares Purchased
Frequently Asked Questions
What is dollar cost averaging (DCA)?
Dollar cost averaging is an investment strategy where you invest a fixed amount at regular intervals, regardless of the stock price. This results in buying more shares when prices are low and fewer when prices are high, reducing the impact of volatility.
How do I calculate my average cost basis?
Divide your total amount invested by the total number of shares purchased. For example, if you invested $5,000 for 100 shares and then $4,000 for 100 shares, your average cost is $9,000 / 200 = $45 per share.
Is averaging down a good strategy?
Averaging down (buying more shares as the price drops) can lower your cost basis, but it also increases your exposure to a losing position. It works best with fundamentally sound investments experiencing temporary price declines.
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