POSTED BY September 25, 2010 9:24 pm COMMENTS (3)ON
Two questions in this…
I know NAV is Net Asset Value…how it is calculated? does it depend on the amount the fund holds and current market value of its shares?
Does extreme redeemption affect NAV value? if so..am i loosing money just cause other thinks the fund is not performing?
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3 replies on this article “How is NAV calculated”
Just to expand the formula.
NAV = (Market Value of Investments held by the Fund – Expenses incurred in the
sale of Assets + Accrued income net of Fund Management Charges + Value of any Current Assets – Value of any Current Liabilities – Provisions, if any)/ Number of Units existing at the Valuation Date
Hope it will help you.
NAV=(assets-liabilities)/number of units
this cant be formula for NAV in this case the if denominator is no of units then extreme redeemption will increase the NAV
NAV is calculated by simply dividing assets from liability divided by total number of units.
NAV=(assets-liabilities)/number of units.
NAV varies daily because the security in the portfolio varies.
Securites are nothing but stocks, bonds, etc.
assets = securities hold in the portfolio like stocks,bonds etc
Liabilities = fund manager fees and other fees
Ya to my knowledge if ther is huge redemption it will afect NAV value
Senior folks please let me know if i am right?