Breakeven / add

How it works

Average entry = (entry1 x size1 + entry2 x size2) / (size1 + size2). That average is your breakeven on the combined position before fees. Legs with non-positive size or price are ignored.

This is bookkeeping after a scale-in or average-down. It is not a reason to add. Adding to a loser because the average “looks better” is how books get stuck.

Worked example

Bought 100 at 50, add 100 at 40: average 45, total size 200, cost 9,000. Price has to get back to 45, not 50, before you are flat on the combined lot, ignoring fees.

Limits

Two fills only. No commissions, FX, or shorts with locate. Options average price is not this formula. If you are adding because the thesis changed, do not use the calculator to talk yourself into it.