moomoo AU Help Center-The cost basis of positions
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The cost basis of positions

Average Cost

Formula

Average cost = (average cost before buying × quantity + the price of this purchase × quantity) ÷ quantity after the purchase

Implication

It is the average cost of the current position of a stock (excluding commissions and fees). Only purchases are considered. The gain or loss corresponding to the sale of a stock does not dilute the cost price, but is converted to realized gain or loss.

Eg.1. Opening A Position

If the customer does not hold Alibaba (BABA) before TDay, and buy 200 shares at \$200/share on T Day, the closing price of BABA is \$205, then

Average Cost = (average cost before purchase × quantity before purchase + purchase price × purchasing quantity) ÷ the quantity held after purchase

=（0+200×200）÷ 200

= 200

 Average Cost Market Price Quantity P&L Unrealized     P&L Realized  P&L 200 205 200 1000 1000 0

Suppose the customer sells 100 shares at \$210/share onT+1 Day, and the closing price of BABA is 215, then

Average Cost = unchanged when selling stock = 200, but the profit and loss = (210-200) × 100 = 1000 turns into Realized P/L.

 Average Cost Market Price Quantity P&L Unrealized     P&L Realized  P&L 200 215 100 2500 1500 1000