What Does Average Trade Price Mean?

By Matthew Frankel, CFP – Updated Aug 6, 2025 at 8:13 PM

Key Points

Average trade price helps track investment performance and calculate capital gains tax.
It's calculated as a weighted average, considering share quantity and price.
Example: Buying stock in phases results in a calculated average price of $81.67 for 300 shares.

The average trade price of a stock is the average cost of one share over a certain period of time or by a specific investor. As a basic example, if you buy one share of a particular stock for $100 and another for $200, your average trade price is $150.

Of course, real-world uses for average trade price aren’t usually that simple. So, here’s a rundown of when average trade price is used, how to calculate it, and an example of how you can use it in your own portfolio.

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An infographic defining and explaining the term "average trade price." — Image source: The Motley Fool

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About the Author

Matt Frankel, CFP, is a contributing Motley Fool stock market analyst and personal finance expert covering financial stocks, REITs, SPACs, and personal finance. Prior to The Motley Fool, Matt taught high school and college mathematics. He holds a bachelor’s degree in physics from the University of South Carolina, a master’s degree in mathematics from Nova Southeastern University, and a graduate certificate in financial planning from Florida State University. He won a SABEW award for coverage of the 2017 Tax Cuts and Jobs Act. He is also regularly interviewed by Cheddar, The National Desk, and other TV networks and publications for his financial, stock market, and investing expertise.

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