InvestorQ : What is an Net Asset Value?
Karim Sahu made post

What is an Net Asset Value?

Swapnil Sarang answered.
3 years ago

NAV or net asset value in simple terms is the price at which you can buy or sell (redeem) one unit of a mutual fund.

In the above image, the circled portion, i.e. Rs. 60.73 is the NAV of every unit of SBI Technology Opportunities Fund (G).

Technically, Net Asset Value is the market value of the assets of the scheme minus its liabilities. The per unit NAV is the net asset value of the scheme divided by the number of units outstanding on the date of valuation.

NAV is calculated by summing the current market values of all securities held by the fund, adding in cash and any accrued income, and then subtracting the liabilities and dividing the result by the number of units outstanding.

For example:

Total value of securities held (equity, bonds, debentures etc.)

Rs. 1,000


Rs. 1,500


Rs. 500

Total outstanding units


NAV [(1000+1500-500)/100]

Rs. 20 per unit