NAV

Net Asset Value

In stocks and businesses, an expression of the underlying value of the company. That is, it is a statement of the value of the companys assets minus the value of its liabilities. One way of thinking about the net asset value is that it is the underlying value of a company, not the value dictated by the supply and demand of shares or its market capitalization. It is also called the book value.

Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

NAV

Wall Street Words: An A to Z Guide to Investment Terms for Todays Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Net asset value (NAV).

The NAV is the dollar value of one share of a fund. Its calculated by totaling the value of all the funds holdings plus money awaiting investment, subtracting operating expenses, and dividing by the number of outstanding shares.

A funds NAV changes regularly, though day-to-day variations are usually small.

The NAV is the price per share an open-end mutual fund pays when you redeem, or sell back, your shares. With no-load mutual funds, the NAV and the offering price, or what you pay to buy a share, are the same. With front-load funds, the offering price is the sum of the NAV and the sales charge per share and is sometimes known as the maximum offering price (MOP).

The NAV of an exchange traded fund (ETF) or a closed-end mutual fund may be higher or lower than the market price of a share of the fund. With an ETF, though, the difference is usually quite small because of a unique mechanism that allows institutional investors to buy or redeem large blocks of shares at the NAV with in-kind baskets of the funds stocks.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

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