# Cost Averaging (I think it's called)



## vivazebull (18 December 2017)

So I bought a stock at like 1.60 and watched it tumble down to around .40 cents anyway i picked up a few more at .51 and on the broker page it averaged out the cost basis at around 1.01...
If the price increases a bit, can I sell off the second parcel amount of shares and take a profit on that parcel, or do both parcels get lumped together and averaged at the cost basis listed on the broker?

I hope this makes sense. 
Thanks.


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## pixel (18 December 2017)

It's totally up to you. As long as you keep accurate records about individual positions, their cost base, buy and sell dates, the Taxman goes along with you.
Seeing you're so deep under water with your $1.60 position, it could well make sense to record a small profit - if possible - on the 51c position and hold on to the high-priced shares. If ever you come into a situation (maybe from other shares) where you need a tax loss sale to reduce CGT, you'll have that option open to you. Or if, against common experience, the shares quadruple in price in a couple of years, you would be able to halve your CGT because you've held them for more than 12 months.
Good luck either way


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## Zero Sum Game (16 January 2018)

https://www.ato.gov.au/Forms/Guide-to-capital-gains-tax-2013-14/?page=41

The attached should point you in the right direction...


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