What is Net Asset Value (NAV) of a Mutual Fund scheme?

Net Asset Value (NAV) is the performance measure of an Mutual Fund Scheme. Mutual funds invest the money collected from the investors in securities markets or you may say in equity share at stock market. It means Net Asset Value is the market value of the securities held by the scheme.

Since market value of securities changes every day, NAV of a scheme also varies on day to day basis. The NAV per unit is the market value of securities of a scheme divided by the total number of units of the scheme on any particular date.

For example, if the market value of securities of a mutual fund scheme is Rs 500 lakhs and the mutual fund has issued 50 lakhs units of Rs. 50 each to the investors, then the NAV per unit of the fund is Rs.50. NAV is required to be disclosed by the mutual funds on a regular basis – daily or weekly – depending on the type of scheme.

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