Avg. cost calculation on Kite

Zerodha
1

Hi,

I do some buying & selling on Zerodha Kite. I had some doubts on how Kite displays the avg. cost of a share.

Example: I make purchased in the following sequence.

1000 x Rs.77 = 77,000
500 x Rs.62 = 31,000
500 x Rs.55 = 27,500
1500 x Rs.25 = 37,500
1500 x Rs.20 = 30,000

Total investment for 5000 shares is Rs.2,03,000. The avg cost displayed on Kite was Rs.40.

I sold 3000 shared at Rs.29 valued at Rs.87,000.

Kite is now displaying the avg cost as Rs.22 and a rather large profit margin which seems very wrong to me. I am down by 1,16,000 on the total investment. The avg cost should be much closer to 66-68.

Is this how calculations work on Kite or is that a bug?

Would appreciate some insight.

Thanks,
Anand

1 Like
3

@Bhuvan @siva please help to clarify avg price…even my avg price and unrealized profit after selling some shares look high

2 Likes
4

@Bhuvan @siva Exactly in the same situation… Purchased some shares, then when the price dropped purchased same quantity again for averaging and then later sold 50% quantity when the price went up… But Kite’s Avg Cost in the Holdings section is totally wrong now showing a big profit whereas there isn’t that much profit… This is very misleading and can cause confusion/wrong decisions…

There should be an option given to the user to Type in his own calculated Avg Cost…

Anyone else observed this and/or found a solution?

5

Saurabh, average cost is calculated based on FIFO (First In First Out) method. Would suggest you read this article to know how the calculation is done: