Mutual Funds

 

How To Calculate Net Asset Value (NAV) Or Book Value Of A Mutual Fund

The NAV (this is also called Book Value) is the value of the mutual fund's assets (market value of all the securities held by the fund plus cash and equivalent holdings), minus the funds expenses/liabilities, divided by the total number of outstanding shares.  The NAV is the price, per share, that you can buy or sell the mutual fund.  The NAV is calculated daily at the close of the markets (except Exchange Trade Funds which are calculated like stocks and can be purchased at any time during the trading day Exchange Traded Funds.

For example:  Here is how you would find the ($20.00 NAV) on a per share basis of Imaginary High Five Mutual Fund:


Assets
(underlying securities, things of commercial
or exchange Value
$52million
Cash and Equivalent Holding $10million
Expenses & Liabilities $2 million
VALUE $52 Mil (Assets)
+ $10 Mil (Cash/Equiv Holdings)
Sub Total $62 Mil
  $2 Mil (Expense/Liabilities)
Value $60 Mil
VALUE PER SHARE $60 Mil (Value)
/ 3 Mil (# of Shares)
NAV/Book Value $20 Per Share