Mobile app: weighted average for stocks with lots across multiple list (instead of simple average)
Bug/Incorrect data: When looking at a stock's detailed quote "Holdings: section, the average cost is displayed as simple average, vs. weighted average for multiple lots across multiple lists.
This leads to Incorrect gain/loss numbers, both in $ as well as relative %.
Suggested solution: when calculating average cost on detailed quote "holdings" section for stock, can you multiple by volume for each lot and divide by total volume?
example
LOT A : 100 qty @ $7/ stock
LOT B: 1000 qty @ $9/stock
LOT C: 10000 qty @ $11/stock
Currently the app displays $9/stock: (7 + 9 + 11) / 3 = 27/3 = 9
This skews the real average cost across lots in multiple lists quite a bit.
the real (weighted) average would be:
( 100 x $7 + 1000 x $9 + 10000 x $11 ) / (100 + 1000 + 10000) = $119700 / 11100 = $10.78378
Given that this average takes into account lots across lists, the current calculation always gives an incorrect number on average as well as an incorrect total gain/loss %
the example above would show the following on your app currently for an current stock price of $9.5: $5,550 gain or 5.56% gain
In fact, the accurate value at that same current stock price of $9.5 would be: -$14,250 loss or -11.90% loss
Taking the weighted average into account would solve the issue with incorrect loss and gain on the mobile app from what I can tell: the gain and loss % appears to be calculated against overall simple average * quantity... applying weighted average would solve all three key numbers to show correctly.
Stefan Polfliet
shared this idea
Hi Stefan,
Thank you for this detailed feedback.
We do weighted averages for Avg Costs on both apps and web. Do you mind to either reinstall the app and/or confirm you're running the latest version?
Thanks,
Yahoo Finance team