Net Asset Value (NAV)

The Net Asset Value (NAV) is used by investment companies to measure net assets.of an investment company is the company’s total assets minus its total liabilities.

Net Asset Value (NAV)

The Net Asset Value (NAV) is used by investment companies to measure net assets.of an investment company is the company’s total assets minus its total liabilities.

 


Net Asset Value Formula

The Net Asset Value (NAV) of an investment company is the company’s total assets minus its total liabilities. The NAV of a single share (or the "per share NAV") is calculated by dividing its NAV by the number of shares that are outstanding.


Mutual funds and Unit Investment Trusts (UITs) are generally required to calculate their NAV once every business day minimum, usually after the major U.S. exchanges close. A closed-end fund, whose shares generally are not redeemable is not subject to this requirement



Interpretation of Net Asset Value

The share price of mutual funds and traditional UITs is based on their NAV. That is, the price that investors pay to purchase mutual fund and most UIT shares is the approximate per share NAV, plus any fees that the fund imposes at purchase (such as sales loads or purchase fees).

The price that investors receive through redemptions is the approximate per share NAV at redemption, minus any fees that the fund deducts at that time (such as deferred sales loads or redemption fees).


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