The difference between an Adjusted Cost Base (ACB) and a Moving Average is this:
- The ACB is the cost of the shares sold.
- The Moving Average is the average cost of shares purchased in present inventory.
Note: If you have bought shares of a certain security since your last sale of this security, your moving average could be different than your ACB.
The Canada Revenue Agency requires investors to use the ACB calculation to determine capital gains or losses for income tax purposes on Schedule 3.
Trader ii software recalculates the ACB after each transaction.