What is Net asset Value For Mutual Funds?

Net Asset Value (NAV) for Mutual Funds is the market value of the securities it owns. Mutual funds put the money they collect from investors into the stock market. Because the market value of assets fluctuates every day, the NAV of a scheme fluctuates as well. On any given day, the NAV per unit is calculated by dividing the market value of a scheme's securities by the total number of units in the scheme. For Example: NAV for 1 unit= (Total assets - Total Liabilities)/ Total Number of outstanding Units Lets Say XYZ Fund has invested in shares worth INR 101 Crore , Let's assume (a) expenses in relation to running of the mutual fund as 1 crore and (b) Total number of units as 10,000. In this case NAV of a unit of the MF will be (101-1) Crore/10,000=INR 1,000 per unit. Is Costlier NAV Better ? Not Necessarily, what matters is the gain in the value of NAV over time. For example : Let's say NAV of ABC Fund is INR 200 per unit and the NAV of XYZ Fund is INR 100 per unit, after one year NAV of ABC is 220 , and NAV of XYZ is INR 150. In the case of ABC your gain was 10% and in the case XYZ your gain was 50%.

What is Net asset Value For Mutual Funds?