is average cost basis method the only type of cost basis method 
no many brokerage firms default to the average cost basis method for mutual funds but other methods are available these include first in first out fifo last in first out lifo high cost low cost and specific identification the bottom linethe average cost basis method calculates the value of mutual fund positions held in a taxable account to determine the profit or loss for tax reporting cost basis represents the initial value of an investor s security or mutual fund 