How is average price calculated for F&O trades ?

Modified on Fri, 12 Apr at 2:41 PM

Buy / sell price is the average of the price of multiple lots bought at different points in time.

For example : If a user buys the Nifty 50 option at INR 100, then his total outgo would be 100 x 25 ( lot size of nifty ) = 2500. After some time, the user decides to average down the price to INR 50 due to downward movement in the Nifty 50, then his outgo would be 50 x 25 ( lot size of nifty ) = 1250. The average price after this trade would be = ( 2500 + 1250 ) / 50 = 75.