Stock Share Calculator
Understanding the Stock Share Calculator
The Stock Share Calculator is a straightforward tool designed to help investors quickly estimate the potential profit or loss from buying and selling shares of a stock. It considers the initial purchase price, the number of shares, the potential selling price, and any applicable commission fees. This allows for a more informed decision-making process before committing to an investment.
How it Works
The calculator performs the following calculations:
- Total Purchase Cost: The total amount spent to acquire the shares, including the purchase price per share multiplied by the number of shares, plus any commission fees on the purchase.
- Total Selling Revenue: The total amount received from selling the shares, including the selling price per share multiplied by the number of shares, minus any commission fees on the sale.
- Net Profit/Loss: The difference between the Total Selling Revenue and the Total Purchase Cost. A positive value indicates a profit, while a negative value indicates a loss.
The Math Behind the Calculation
Let's define the variables:
P= Purchase Price per ShareN= Number of SharesS= Selling Price per ShareC= Commission Fee Rate (as a decimal, e.g., 0.1 for 0.1%)
1. Purchase Commission: Purchase Price per Share * Number of Shares * (Commission Fee Rate / 100)
* In JavaScript: `var purchaseComm = purchasePrice * numberOfShares * (commissionFee / 100);`
2. Total Purchase Cost: (Purchase Price per Share * Number of Shares) + Purchase Commission
* In JavaScript: `var totalPurchaseCost = (purchasePrice * numberOfShares) + purchaseComm;`
3. Selling Commission: Selling Price per Share * Number of Shares * (Commission Fee Rate / 100)
* In JavaScript: `var sellingComm = sellingPrice * numberOfShares * (commissionFee / 100);`
4. Total Selling Revenue: (Selling Price per Share * Number of Shares) - Selling Commission
* In JavaScript: `var totalSellingRevenue = (sellingPrice * numberOfShares) – sellingComm;`
5. Net Profit/Loss: Total Selling Revenue - Total Purchase Cost
* In JavaScript: `var netProfitLoss = totalSellingRevenue – totalPurchaseCost;`
Example Use Case
Imagine you purchase 50 shares of a stock at $150.75 per share. You pay a 0.1% commission on the transaction. A few months later, you decide to sell all 50 shares at $165.50 per share, again paying a 0.1% commission.
- Purchase Price per Share: $150.75
- Number of Shares: 50
- Selling Price per Share: $165.50
- Commission Fee: 0.1%
Using the calculator:
- Purchase Commission: $150.75 * 50 * (0.1 / 100) = $7.54
- Total Purchase Cost: ($150.75 * 50) + $7.54 = $7,537.50 + $7.54 = $7,545.04
- Selling Commission: $165.50 * 50 * (0.1 / 100) = $8.28
- Total Selling Revenue: ($165.50 * 50) – $8.28 = $8,275.00 – $8.28 = $8,266.72
- Net Profit/Loss: $8,266.72 – $7,545.04 = $721.68
In this scenario, the estimated net profit is $721.68. This calculator helps visualize the impact of price changes and fees on your investment's profitability.