Securities

Net Asset Value (NAV)

NAV is the per-share value of a mutual fund or ETF, calculated by dividing total assets minus liabilities by the number of outstanding shares.

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Exam Tip

NAV is calculated at 4 PM ET. Orders after 4 PM get NEXT day's NAV.

What is Net Asset Value (NAV)?

Net Asset Value represents the per-share value of a fund's holdings. It's the price at which you buy (at NAV + any load) or sell (at NAV) mutual fund shares.

NAV Formula

NAV = (Total Assets - Total Liabilities) ÷ Shares Outstanding

Example Calculation

  • Total Assets: $100 million
  • Total Liabilities: $2 million
  • Shares Outstanding: 4 million

NAV = ($100M - $2M) ÷ 4M = $24.50 per share

When is NAV Calculated?

  • Mutual Funds - Once daily at 4:00 PM ET (market close)
  • ETFs - Have NAV but trade at market prices throughout the day

NAV and Fund Pricing

Order TimePrice Received
Before 4 PM ETSame-day NAV
After 4 PM ETNext-day NAV

This is called forward pricing - you don't know the exact price until after market close.

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