1. What Is Mutual Fund NAV?

Net Asset Value (NAV) represents the per-unit value of a mutual fund, calculated as total assets minus liabilities divided by the number of outstanding units. It indicates the fund's underlying value and is used for buying and selling fund shares.

2. How Does The Calculator Work?

The calculator uses the NAV formula:

Where:

• \( Assets \) — Total value of all investments and cash holdings (USD)
• \( Liabilities \) — Total debts and obligations (USD)
• \( Outstanding\ Units \) — Total number of units issued by the fund

Explanation: The formula calculates the net value per unit by subtracting liabilities from total assets and dividing by the number of units outstanding.

3. Importance Of NAV Calculation

Details: NAV is crucial for investors to determine the fair value of mutual fund shares, track fund performance, and make informed investment decisions. It's calculated daily after market close.

4. Using The Calculator

Tips: Enter total assets and liabilities in USD, and the number of outstanding units. All values must be valid (assets ≥ 0, liabilities ≥ 0, units > 0).

5. Frequently Asked Questions (FAQ)

Q1: How often is NAV calculated?
A: Mutual funds typically calculate NAV once per trading day, after market close, based on closing prices of securities in the portfolio.

Q2: What's included in assets and liabilities?
A: Assets include stocks, bonds, cash, and other investments. Liabilities include management fees, operating expenses, and other debts.

Q3: Why does NAV change daily?
A: NAV fluctuates with changes in the market value of the fund's underlying investments and the fund's expenses.

Q4: Is a higher NAV better?
A: Not necessarily. NAV reflects current value but doesn't indicate future performance. Focus on the fund's investment strategy and historical returns.

Q5: Can NAV be negative?
A: No, NAV cannot be negative as it represents value per unit. If liabilities exceed assets, the fund would typically be liquidated.