Net Asset Value (NAV)
Intermediate
What Is NAV?
NAV, or Net Asset Value, is a term used to describe the value of a fund’s assets minus its liabilities. It helps investors understand the value of each share they own in a mutual fund or an exchange-traded fund (ETF). You can think of it as the price tag for each share of the fund.
How Is NAV Calculated?
NAV is calculated by subtracting the fund’s liabilities from its assets and then dividing the result by the total number of shares. The formula looks like this:
NAV = (Total Assets – Total Liabilities) / Number of Outstanding Shares