What is average cost — your average purchase price?
Average cost is what you have paid per share on average, including commission. In Denmark it is called GAK (gennemsnitlig anskaffelseskurs) or GAV. If you bought 10 shares at 100 and later 10 at 150, your average cost is 125. It is the figure your account measures gain and loss from, and the figure the Danish tax authority uses when you sell — Danish share gains are calculated by the average method. Other countries use other methods, such as first-in-first-out.
A worked example
- Purchase 1: 10 shares at 100 + 4 commission = 1,004
- Purchase 2: 10 shares at 150 + 4 commission = 1,504
- 20 shares for 2,508 in total → average cost = 2,508 / 20 = 125.40
If you now sell 5 shares at 160 (800 minus 4 commission = 796), your taxable gain under the average method is 796 − 5 × 125.40 = 169. It does not matter whether you "think" you sold the ones from the first purchase. The average method always uses the average.
Why the average cost changes
Every time you buy more, the average moves towards the new price. Buy below your average and it falls — that is called "averaging down". Buy above and it rises. When you sell, the average does not change — you sell at the average, and the remaining shares keep the same average cost. Dividends do not affect it either.
Average cost and tax
Under the Danish average method, the gain on a sale is the sale proceeds minus (average cost × number sold). Danish providers usually report the figures to the tax authority, so your tax return is pre-filled — but you are responsible for them being right. If you bought the same shares in several accounts, the average must be calculated across all of them. Shares in an aktiesparekonto are kept separate. Countries such as the US and UK use different rules (specific lot or FIFO), so check your own.
The typical beginner's mistake
Buying more of a falling stock "to bring the average down" — and ending up with a bigger position in a company that is still falling. Average cost is an accounting figure. It says nothing about whether the company is worth owning more of. Ask that question, not the one about the average.
How you see it in Kiggo
Enter your own purchases in Kiggo's portfolio, and it shows gain and loss per stock and in total.
Related terms
Frequently asked questions
Are GAK and GAV the same?
Yes. GAK (gennemsnitlig anskaffelseskurs) and GAV (gennemsnitlig anskaffelsesværdi) are two Danish names for the same figure. Some banks use one, others the other.
Does commission count in the average cost?
Yes. The commission is added to the purchase price, so your average cost is slightly higher than the share price — and your taxable gain slightly smaller. Danish providers do this automatically.
What happens to the average cost in a stock split?
If you get 2 shares for every 1 (as in Novo Nordisk's 2023 split), your average cost halves, because you now have twice as many shares for the same money. The value of the holding is unchanged.
Kiggo explains — Kiggo does not advise. We never tell you what to buy or sell, and key figures can only be compared between companies in the same industry. The decision is yours. Last updated 2026-09-23.
Written by Claus Frisch, founder of Kiggo. Not an adviser, not a bank — Kiggo explains, you decide.
