Question 1

How do I calculate my average stock price?

Accepted Answer

Average Price = Total Amount Invested ÷ Total Shares Purchased. If you bought 10 shares at $100 and 20 shares at $80, average = ($1,000 + $1,600) ÷ 30 = $86.67. Your break-even price is $86.67.

Question 2

Is averaging down always a good idea?

Accepted Answer

Averaging down (buying more as price falls) lowers your average cost but increases your total exposure to a declining asset. It can be a valid strategy for index funds or high-conviction long-term positions, but is dangerous for individual stocks where a company can go bankrupt.

Question 3

What is the difference between averaging down and DCA?

Accepted Answer

Averaging down usually refers to buying more of a losing position. DCA (dollar-cost averaging) refers to regular, scheduled purchases regardless of price direction. The math is the same, but the intent and risk profile differ — DCA is typically used for long-term accumulation, not rescue of losing trades.

Question 4

Does this calculator work for crypto cost basis?

Accepted Answer

Yes — enter any purchase price and quantity. The calculator works identically for crypto, stocks, ETFs, or any asset measured in units and price. For tax purposes, consult a qualified tax professional about specific cost basis methods (FIFO, LIFO, specific identification) required in your jurisdiction.

Stock Average Price Calculator