The formula
How to calculate stock profit
The profit on a share trade is the price difference times the number of shares, less everything the trade cost you. Fees are small on a large position and decisive on a small one, which is why the break-even price is worth knowing before you buy.
Include both sides: the commission to buy, the commission to sell, and any transaction tax. In the UK that means 0.5% stamp duty on most purchases, which is often larger than the broker's fee.
What to enter:
- Buy price per share
- Sell price per share
- Number of shares
- Total fees and commission — both sides of the trade, plus any stamp duty
The result updates on every keystroke. The URL updates too, which makes the filled-in version easy to bookmark or send to someone else.
Worked example
Here is the calculation with the starting values:
- Buy price per share: 28
- Sell price per share: 42
- Number of shares: 300
- Total fees and commission: 24
That gives:
- Net profit: 4,176
- Return on investment: 49.71 %
- Break-even sell price: 28.08
Reading the result
Return on investment here is a total figure, not an annual one. A 49% return is excellent over one year and unremarkable over eight — annualise it before comparing against anything else.
Where this goes wrong. Forgetting tax on the gain. Outside an ISA or pension, profits above the annual exempt amount attract capital gains tax, and the net figure can be materially below the one shown here.
No, this is the capital gain only. Add dividends received during the holding period to get the total return, which for income-paying shares held several years can be a large share of the result.
The answer it gives you is net profit. With 28 buy price per share, 42 sell price per share and 300 number of shares, that comes to 4,176. Change any field and the figure moves with it.