Average Down Calculator
Find your new average cost after buying more of a position at a lower price.
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Quick answer
Find the new average price after buying more
The average-down calculation combines the cost and quantity of an existing position with a second purchase. The result is weighted by quantity, so it is more accurate than taking the simple average of the two prices.
Use this calculator when
- Planning a second purchase below the original entry price
- Updating the cost basis after adding to a position
- Comparing different purchase sizes before placing an order
How to read the result
The new average moves closer to the price of the larger purchase. A lower average cost reduces the price needed to recover the position, but it also increases total capital committed and does not reduce market risk.
- Use units or shares consistently for both purchases
- Add commissions to cost separately if they are material
Method
How it works
Add the quantity and price from the original purchase, then the quantity and price from the additional purchase. The calculator combines both costs and divides them by the total number of shares.
The result is a weighted average, so a larger purchase has a greater effect than a smaller one. The change metric compares the new average with the first purchase price.
Common questions
Frequently asked questions
Does the second purchase have to be at a lower price?
No. A higher second price will increase the average instead of reducing it.
Are fees included?
No. Enter prices that already reflect any costs if you want to account for fees.
Why is this not a simple average of two prices?
Each price is weighted by its share quantity, so unequal purchases cannot be averaged by adding the prices and dividing by two.
Not financial advice. This calculator is for general informational purposes only. Check figures independently before making financial decisions.