What Is a Break-Even Price? Fees on a Round Trip
Try these example inputs in the Break-even calculator.
These figures match this guide's worked example. They are illustrative. They stay on this device and never appear in the URL.
A break-even sell price is the price that returns every dollar the trade spent: the shares, the buy fee, and the sell fee. At that price the gain is zero.
Key takeaways
- With flat fees only, break-even sell price = (buy price × shares + buy fee + sell fee) ÷ shares.
- 100 shares at $50, with a $5 buy fee and a $5 sell fee, break even at $50.10.
- A percent buy fee is added to that cost. A percent sell fee means you keep only part of the sale, so the price divides by shares × (1 − sell-fee percent). The same 100 shares at $50 with a 1% buy fee and a 1% sell fee break even near $51.01.
- Tax does not change that price. Tax applies to a gain, and the gain here is zero.
- Anything above that price is a gain before tax.
The formula
Flat fees: break-even sell price = (buy price × shares + buy fee + sell fee) ÷ shares
Percent sell fee: divide that cost by shares × (1 − sell-fee percent)
Fees may be zero. If every fee is zero, the break-even price equals the buy price. A percent buy fee is buy price × shares × that percent, added to any flat buy fee before the division.
A worked example
Buy 100 shares at $50. Pay a $5 fee to buy and a $5 fee to sell.
- Cost = 100 × $50 + $5 + $5 = $5,010.
- Break-even = $5,010 ÷ 100 = $50.10.
A sale at $50.10 returns the $5,010. The break-even calculator uses this identity. Dollar profit on a round trip that also includes dividends is on the stock profit calculator.
If those 100 shares also collected $25 of dividends, economic break-even on the stock-profit page is lower: you already recovered $25 of the $5,010 outlay. That is a different model (fees plus dividends, optional separate buy and sell fees). This break-even page stays at the sale price that covers cost without counting those dividends.
What the break-even price tells you
It is the sale price that covers the round trip before tax. The distance from your buy price to that line is the fee drag, spread across the shares.
What the break-even price leaves out
A target profit after tax needs a higher sale price, because tax takes a share of the gain. This page stops at zero gain. It also assumes the fees you typed are the whole cost. Borrow fees, ADR fees, and a fill at a different price are separate.
The share count that fits a loss limit is position size. A live quote is not your break-even. Type the buy price and the fees in the break-even calculator.
For general education only. Nothing here is investment advice.
Sources
- Investor.gov: buying and selling stocks (opens in a new tab)
Formulas and worked examples are MarketCapLens's. See who checks the numbers.
Frequently asked questions
- How do you calculate a break-even sell price?
- Add the buy fee and the sell fee to the cost of the shares, then divide by the share count. 100 shares at $50 with a $5 buy fee and a $5 sell fee break even at $50.10. The MarketCapLens break-even calculator uses this formula.
- Why does tax stay out of the break-even price?
- Tax applies to a gain. At the break-even price the gain is zero, so the tax is zero.