For Business

Trading Math

How to Calculate Break-Even After Adding

When a second trade is added to a first, the break-even of the two together is the average entry: each price weighted by its lots, divided by the total lots. This paper shows you the average on a number line for equal and unequal lots, the sum twice on two real prices from one day, what adding does to the distance and the money at the stop, and where the platform shows the average.

Difficulty
Advanced
Reading time
5 min
Pages
7
Reviewed by
Saman Rahbar

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The average on a number line

When a second trade is added to a first on the same symbol, the two together are level at one price, and it is not either of the two entries. On 3 September 2026 one lot of the euro against the dollar was bought at the open, 1.15872, and one lot at 1.15842, where the price dipped in the 03:00 hour — a pip is the fourth decimal place, so three pips lower. With equal lots the average entry is halfway between, 1.15857. With two lots at the lower price and one at the higher, the average sits nearer the larger trade, 1.15852. That average is the break-even of the whole position.

The sum, twice

The sum is a weighted average: each price times its lots, the products added, the total divided by the total lots. One lot at 1.15872 plus one at 1.15842 is 2.31714, and over two lots that is 1.15857. One lot at 1.15872 plus two at 1.15842 is 3.47556, and over three lots that is 1.15852. Costs sit on top of it — the spread and any commission push the true break-even a fraction of a pip above the average on a buy — but the average is the number the position is built on.

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