How to calculate my average price per share.
Eg If you buy 2 lots of 100 shares at $1 and $2 then you have spent $300 on 200 shares = $1.50 per share average. But you will have paid 2 commissions (and you will pay another to sell). Lets assume that each commission is $10 then your profit only starts if you sell for more than $330. Therefore your breakeven price is not $1.50, but 330/200 = $1.65.
Looking for some real help. I am a personal trainer in the UK looking to set up and deliver CPD courses.
I have potential investors to help do this but I need to get my head around issuing shares and making it attractive for them. I am not educated on this area so any help would be great.
I am looking to
Show investment for each investor
Price of each share
6 years in: model based on 100% return initial investment
I then need to show
value of shares after 6 years
I want to be able to grow this business for the long term. How many shares can I issue / attract further investment from other investors?
($ per share A) x (# of A shares) + ($ per share B) x (# of B shares) + ($ per share C) x (# of C shares) = Total Spent
Total Spent / Total number of shares = Average Price per Share
You buy 50 shares of XYZ at $20, then later you buy 75 shares of XYZ at $18, finally you buy 25 shares of XYZ for $15. To find the average price per share of your XYZ positions you multiply each set cost per share by the number of shares purchased.
50 x $20 = $1000
75 x $18 = $1350
25 x $15 = $375
now add the totals together
1000 + 1350 + 375 = $27,525
divide this number by the total number of XYZ shares you have.
50 + 75 + 25 = 150 shares
$27,525 / 150 shares = $18.1666666 = average price per share
I know that to figure a break-even point one takes the total amount invested including commissions divided by the total number of shares and add the sell commission per share. But what about a more complex case-
suppose I have an account that was a managed account part of the time and commission based for another time period.
If I add up the total number of shares bought or sold under management and divide it into the total management fees for that period that will give me an average management cost(AMC) per share. Now if I calculate the average cost per share of a stock excluding management fees but including any commissions and add that to the AMC per share I will have an average cost per share that must be exceeded to make a profit but I still have to account for the sale commission(switched from managed acct to commission based before the sale).
Is this procedure correct so far and if I know that the sale commission will be 2% how do I complete the calculation for a break-even