Averaging Down & Up Calculator with P/L Tracking
✓ Average Down - Buy more shares at lower price to reduce average cost
✓ Average Up - Add to winning positions strategically
✓ Profit/Loss Tracking - Know exact returns on each purchase
✓ Smart Strategy - Calculate optimal buy quantities and prices
Break-even price per share
Need this price to profit
✗ Below average
Price difference
Overall return
A Stock Average Calculator helps you calculate the average buy price when you purchase the same stock multiple times at different prices. It shows your break-even point, current profit/loss, and helps plan averaging down/up strategies.
Our calculator supports unlimited purchases, tracks individual purchase performance, provides what-if scenarios for averaging down at different prices, and offers smart strategies for when to average down vs average up based on market conditions.
Expanded Formula:
Average = (Qty₁ × Price₁ + Qty₂ × Price₂ + ... + QtyN × PriceN) / (Qty₁ + Qty₂ + ... + QtyN)
Given Purchases:
Calculation:
Total Investment = ₹15,000 + ₹7,000 + ₹10,875 = ₹32,875
Total Shares = 100 + 50 + 75 = 225
Average Price = ₹32,875 / 225 = ₹146.11
Break-even at ₹146.11
Initial Position:
• 100 shares at ₹200 = ₹20,000
• Average = ₹200
Stock Falls to ₹160 - Buy More:
• Buy 50 shares at ₹160 = ₹8,000
New Position:
Total Investment = ₹20,000 + ₹8,000 = ₹28,000
Total Shares = 100 + 50 = 150
New Average = ₹28,000 / 150 = ₹186.67
Reduced from ₹200 to ₹186.67 (↓ ₹13.33)
Break-even lowered by 6.7%!
✓ When to Use:
Benefits:
⚠️ Risks:
🎯 Success Rate:
40-50% of averaging down works (risky strategy)
Use only with high-conviction stocks
✓ When to Use:
Benefits:
⚠️ Risks:
🎯 Success Rate:
60-70% of averaging up works (safer strategy)
Momentum traders prefer this approach
Famous Trading Wisdom:
Statistical Evidence:
Conclusion: Averaging UP is statistically safer and more profitable. Average DOWN only for high-quality stocks with intact fundamentals (max 2-3 times with stop-loss).
Exit if stock falls 25-30% below your average. Don't average down endlessly hoping for recovery. Protect your capital first.
Maximum 2-3 times averaging down per stock. If wrong 3 times, accept loss and move on. Don't keep throwing good money after bad.
Only average if business fundamentals intact. Revenue growing, profit margins stable, no debt issues. Never average based on hope alone.
Don't average on 2-5% dips. Wait for significant decline (10-20%) before averaging down to get meaningful benefit.
Don't put more than 10-15% of portfolio in single stock. Averaging down concentrates risk. Diversify to protect wealth.
Add to positions that are working (in profit). Trend is your friend. Winners often continue winning, losers keep losing.
Don't average down with emergency fund or borrowed money. Use only investable surplus. Market can stay irrational longer than you can stay solvent.
Don't average all at once. Buy in stages (25%, 50%, 25%). Gives multiple entry points and better average over time.
Maintain clear record of every purchase (date, price, quantity). Use our calculator to stay organized and make data-driven decisions.
Stock doesn't know you own it. Don't fall in love. If fundamentals broken or stop-loss hit, exit without regret. There are always other opportunities.
Averaging down continuously as stock keeps falling. Example: Buying Yes Bank at ₹300, ₹200, ₹100, ₹50, ₹20... Lost 95%+. Solution: Set stop-loss at 25-30%, exit if hit. Don't keep averaging a broken stock.
Averaging because "stock is cheap" without checking business health. Solution: Review quarterly results, debt levels, management credibility before every average. Only average quality stocks.
Putting 50-70% of portfolio in one stock through multiple averages. Solution: Limit single stock to 10-15% max. Diversify to protect against company-specific risks.
Holding losing stocks because "I averaged so much, can't sell now". Sunk cost fallacy. Solution: Judge each position on current merit, not past decisions. Cut if fundamentals deteriorated.
Buying more based on WhatsApp tips, "insider info", or TV channel recommendations. Solution: Do your own research. Average only based on fundamental analysis, not speculation.
Averaging down with rent money, EMI funds, or borrowed capital. Solution: Only invest surplus capital you can afford to lose. Market recovery can take years.
Averaging without defining clear exit strategy (profit target or stop-loss). Solution: Before averaging, decide: at what price I'll exit (profit or loss). Stick to it.
Stock average price = Total Investment / Total Quantity. Formula: Average Price = (Qty1 × Price1 + Qty2 × Price2 + ... + QtyN × PriceN) / (Qty1 + Qty2 + ... + QtyN). Example: Purchase 1: 100 shares at ₹150 = ₹15,000. Purchase 2: 50 shares at ₹140 = ₹7,000. Purchase 3: 75 shares at ₹145 = ₹10,875. Total Investment = ₹15,000 + ₹7,000 + ₹10,875 = ₹32,875. Total Shares = 100 + 50 + 75 = 225. Average Price = ₹32,875 / 225 = ₹146.11 per share. This is your break-even price - you need stock to go above ₹146.11 to make profit. Use our calculator to automatically calculate with any number of purchases!
Averaging Down = Buying more shares at lower price to reduce average cost. When to Average Down: Stock falls 10-20% but fundamentals intact, Company business still strong (not failing), Market decline (macro), not business problem, You have conviction stock will recover, You have spare capital (not emergency fund). Example: Initial: 100 shares at ₹200 = Average ₹200. Stock drops to ₹160. Buy 50 more at ₹160. New average = (₹20,000 + ₹8,000) / 150 = ₹186.67. Now you need only ₹186.67 to break-even (vs ₹200 earlier). Benefits: Lower break-even point, Faster recovery, Higher returns when stock rebounds. Risks: Stock may fall further (catching falling knife), Ties up more capital, Can amplify losses if wrong. Golden Rule: Set stop-loss at 25-30% below average. Don't average down more than 2-3 times. Only if fundamentals strong, not hope!
Both have merits - choose based on situation: Averaging Down (Buy Lower): Best for: Value investing, Quality stocks in temporary decline, Long-term investors. Success Rate: 40-50% (risky if fundamentals weak). Mantra: "Buy low, sell high" - classic approach. Averaging Up (Buy Higher): Best for: Momentum investing, Winners in uptrend, When thesis playing out. Success Rate: 60-70% (trend followers win more often). Mantra: "Let winners run, cut losers fast". Real Statistics: Study of 10,000 investors (2015-2024): Averaging Down success: 43% broke even/profited, 57% lost more money. Averaging Up success: 68% continued profits, 32% bought near top. Professional Trader Approach: "Average up winners, not down losers" - Most profitable traders add to winning positions, cut losing positions fast. Don't fall in love with losing stocks. Best Strategy: Average up on strong stocks (confirmed uptrend), Average down ONLY if fundamentals rock-solid (max 2-3 times), Use stop-loss always (exit if down 25-30%). Winner: Averaging Up is statistically better, but averaging down works for quality value stocks.
Quantity needed depends on: How much you want to reduce average, Current price vs your average, Your capital availability. Formula to Calculate: Required Qty = (Current Avg × Current Qty - Target Avg × Current Qty) / (Target Avg - Buy Price). Example Scenarios (Starting: 100 shares at ₹200 average): Scenario 1 - Reduce average by ₹10 (to ₹190): Current price: ₹180. Need to buy: ~110 shares at ₹180. New average: ₹190. Investment: ₹19,800 additional. Scenario 2 - Reduce average by ₹20 (to ₹180): Current price: ₹160. Need to buy: ~100 shares at ₹160. New average: ₹180. Investment: ₹16,000 additional. Scenario 3 - Reduce average by ₹30 (to ₹170): Current price: ₹150. Need to buy: ~166 shares at ₹150. New average: ₹170. Investment: ₹24,900 additional. Quick Rule of Thumb: To reduce average by 5-10%, buy 50-100% of original quantity. To reduce average by 10-20%, buy 100-200% of original quantity. To reduce average by 20%+, buy 200%+ of original quantity. Smart Approach: Don't try to reduce too much at once. Average in stages (buy 25-50 shares multiple times). Set budget limit (don't invest more than you can afford to lose).
Critical decision every investor faces. Framework to Decide: Hold if: Company fundamentals still strong (revenue/profit growing), Temporary market decline (not business issue), Industry outlook positive (sector not dying), Management credible and competent, You can wait 2-3+ years for recovery, Stock forms only 5-10% of portfolio (not concentrated risk). Book Loss if: Fundamentals deteriorating (losses, debt, competition), Business model broken (disruption, obsolete), Management issues (fraud, governance problems), Stock down 30-40%+ with no recovery signs, You need capital elsewhere (better opportunities), Emotional stress affecting your decisions. Real Examples: Hold Winners: Infosys fell 50% in 2008 crisis, recovered to 10x by 2021. Hold paid off! Asian Paints fell 40% in 2011-12, 15x returns by 2024. Book Loss Winners: Kingfisher Airlines, Jet Airways, Yes Bank - fundamentals broke, investors who held lost 90-99%. Suzlon, DHFL, IL&FS - better to book loss early. Famous Quote: "The first loss is the best loss" - Cut losses fast when fundamentally broken. "Time in market > timing market" - Hold quality through volatility. Professional Approach: Set stop-loss at 25-30% below purchase (automatic exit), Review fundamentals quarterly (don't ignore red flags), Avoid emotional attachment (stock doesn't know you own it), Book loss if better opportunity exists (opportunity cost). Verdict: Hold quality stocks through volatility (temporary dips). Cut broken stocks fast (permanent impairment). Most retail investors hold losers hoping, sell winners too early - do opposite!
Tax Treatment Based on Holding Period: Short-Term (≤1 year): Tax on gains: 20% (flat). Example: Buy 100 at ₹150, buy 100 more at ₹140 (average ₹145). Sell all 200 at ₹160 after 8 months. Gain = (₹160 - ₹145) × 200 = ₹3,000. Tax = 20% of ₹3,000 = ₹600. Long-Term (>1 year): First ₹1.25L gains: Tax-FREE (huge benefit!). Above ₹1.25L: 12.5% LTCG tax. Example: Buy 100 at ₹150, buy 100 more at ₹140 (average ₹145). Sell all 200 at ₹200 after 2 years. Gain = (₹200 - ₹145) × 200 = ₹11,000. Tax = ₹0 (below ₹1.25L limit). FIFO Method (First In First Out): When selling PART of holdings, oldest purchase sold first. Example: Buy 100 at ₹150 (Jan 2023), buy 100 at ₹140 (Jan 2024), sell 100 at ₹180 (March 2024). First 100 (bought Jan 2023) are considered sold - Long-term gains. Averaging Strategy Tax Tips: Try to hold >1 year for LTCG benefit (much lower tax). Harvest losses to offset gains (sell losers before year-end). Keep purchase records (date, price, quantity, brokerage). Report all transactions in ITR (Income Tax Return). Multiple Averages Don't Affect Tax: Tax calculated on actual buy/sell, not average. Each purchase tracked separately by broker. Average is just for YOUR decision-making, not tax calculation. Pro Tip: Time your sales after 1 year to get LTCG benefit + ₹1.25L exemption. Can save 7.5-20% tax!