I purchase 250 shares of company z for $105, I now want to buy another 250 shares of company z at a price that averages my share pice to $99

Question

I purchased 250 share of company Z for $105 

I want to purchase another 250 shares at a price that will average my per share price at $98 

what price should I pay for Company Z shares

Answer 1

Because we know the share price of the first purchase, we can figure out what we'd need the second purchase total to be using the following equation...

 

(105+c)/2=99

 

c=93

 

So our second purchase would be 

 

250s=93

 

S would equal about 37.2 cents per share.