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Why do I see a profit in the positions tab on Kite even though the buy average is higher than the LTP?

When you've traded intraday in the same scrip multiple times in a trading day, and you open a new position in the same scrip, the buy-average for this will be calculated considering the total quantity traded that day.

Let us understand this with an example - 

Let's say you're bullish on ITC. You buy 50 quantity of ITC @Rs 280. The stock moved as per your view & you then close the position @Rs 287. You book a profit of Rs 350. Now the price You buy 70 shares of ITC again @Rs 283. Now, the buy average shown in positions will be Rs 281.75*

* (50x280)+(70x283)/120 = 281.75

Now, let's say the price goes back down to Rs 280. In this case, the P&L will be a profit of Rs 140* [even though the buy average of Rs 281.75 is greater than the price @Rs 280]

* 350 - (3x70) = 140

So, the profit or loss shown on Kite under the positions tab is considering all your trades in that stock/contract on that day until that point.

The reason for this is, this will give a clear overview as to what your P&L is for your trades in that particular scrip for that day.