1. What is Average Price Calculator?

The Stock Average Calculator helps investors calculate their average buy/sell price across multiple transactions. This is particularly useful for Zerodha users to track their investment cost basis and make informed trading decisions.

2. How Does the Calculator Work?

The calculator uses the weighted average formula:

Where:

• \( Qty_i \) — Quantity of shares in transaction i
• \( Price_i \) — Price per share in transaction i (₹)
• \( Total\ Qty \) — Sum of all quantities across transactions
• \( \sum (Qty_i \times Price_i) \) — Total investment value

Explanation: The formula calculates the weighted average price based on the total investment divided by total shares purchased.

3. Importance of Average Price Calculation

Details: Knowing your average price helps determine break-even points, calculate profits/losses, and make strategic decisions about when to buy more or sell holdings.

4. Using the Calculator

Tips: Enter the number of transactions first, then fill in quantity and price for each trade. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Why calculate average price?
A: It helps track your actual cost basis across multiple purchases at different prices, essential for profit/loss calculation.

Q2: Does Zerodha show average price?
A: Yes, Zerodha's console shows average buy price for your holdings, but this calculator helps verify or calculate manually.

Q3: How does averaging down work?
A: Buying more shares at lower prices reduces your overall average cost per share, potentially improving profit margins.

Q4: What if I have both buy and sell transactions?
A: For accurate average buy price, only include purchase transactions. Sell transactions reduce your holding quantity.

Q5: Is brokerage included in average price?
A: This calculator shows pre-brokerage average. For true cost basis, add brokerage costs to your total investment.