In short
- Average cost is the average price at which you hold a share.
- A paper gain exists as long as you have not sold.
- It becomes realised after the sale.
Average cost per share
A made-up example, with no fees to keep it simple:
| Purchase | Quantity | Price | Amount |
|---|---|---|---|
| First purchase | 100 | 100 MAD | 10,000 MAD |
| Second purchase | 100 | 120 MAD | 12,000 MAD |
| Total | 200 | 22,000 MAD |
The average cost is 22,000 ÷ 200, or 110 dirhams. On a real statement, fees may be included: check your institution’s method.
Value and paper gain
If the current price is 115 dirhams:
- Value: 200 × 115 = 23,000 dirhams.
- Paper gain: 23,000 − 22,000 = 1,000 dirhams.
- Performance: 1,000 ÷ 22,000 = about 4.5%.
This gain is not secured: it changes with the price, and it does not include selling fees or tax.
Paper or realised
| Paper | Realised | |
|---|---|---|
| When? | Before the sale | After the sale |
| Does it change? | Yes, with the price | No, it is fixed |
| Tax on the gain | Not in principle | Under the rules in force |
Dividends and the statement
On the ex-dividend date, the price usually falls by the amount of the dividend. The share’s line can therefore drop while the cash account later receives the dividend. To judge a result, you need to look at both.
Other lines to check
- The cash account: the money available.
- Open orders: those not yet filled.
- Fees charged: brokerage and custody, see our guide to trading fees.
- Corporate actions: after a split, the average cost and quantity are adjusted.
Frequently asked questions
Is a paper loss a real loss?
Your portfolio really is worth less at that moment. The loss is only recorded when you sell, but it can shrink or grow until then.
Why does my average cost change?
It changes after a new purchase or a corporate action. A sale generally does not change it.
This article is for information and educational purposes only. It is not investment advice or a recommendation to buy or sell any security. Investing in shares involves a risk of capital loss. Check figures against official sources (Casablanca Stock Exchange, AMMC) and consult a licensed professional. Read the full disclaimer.
