Enter the total monetary amount invested in a mutual fund and the total number of shares owned to calculate the average cost basis.
Average Cost Basis Formula
The following formula is used to calculate an average cost basis.
ACB = TI / S
- Where ACB is the average cost basis
- TI is the total amount invested in the mutual fund
- S is the total number of shares owned
Average Cost Basis Definition
An average cost basis is defined as the average cost of a fund or stock per share of the fund owned. That is the amount you paid per share on average.
Average Cost Basis Example
How to calculate an average cost basis?
- First, determine the total amount invested.
Calculate the total amount invested over time.
- Next, determine the number of shares.
Calculate the total number of shares currently owned.
- Finally, calculate the average cost basis.
Using the equation above, calculate the average cost basis.
A cost basis is defined as the total cost including fees that were used to purchase a security.