The net asset value, or NAV, reflects the current market value of a mutual fund. NAV is usually calculated and reported by each fund on a daily basis. If you want to check the figures for yourself or calculate the value of your investment more often than the fund does, you can compute the NAV for yourself. You will need to gather some basic information about the fund to perform the calculation. All of this information is readily available to the public.
1. Research the bond mutual fund to ascertain which bonds it holds and the quantity of each bond in its portfolio. You can get this information from the daily reports that the fund must file with the Securities and Exchange Commission. This information is entered into the EDGAR system, and it is available free to the public. You can browse the EDGAR website and input the name of the fund you are researching to obtain the relevant data.
2. Check the current valuation of each bond in the mutual fund's portfolio. Obtain this information from any brokerage firm and most of the larger financial websites.
3. Add the value of all of the bonds together to determine the total value of the fund’s assets. This number represents the gross value.
4. Subtract all of the company’s liabilities from the gross value of the assets. The resulting number is the fund’s net asset value.
5. Determine how many shares the bond mutual fund has issued, and whether these have been sold to investors or are held by the company. This data should be available from the fund’s managers as well as through the SEC.
6. Divide the net assets by the total number of shares issued to determine the NAV for each share. This value will likely change from day to day, and it may fluctuate significantly during times of market turbulence.
- Check the financial section of your newspaper for the NAV of the mutual fund you are researching. NAVs are typically published the following business day in larger newspapers. The quote published in the paper should be very close to the value you calculated.
- Mutual funds are an open-end investment, meaning that the fund can issue new shares at any time. This is often done when there are more buyers than shares. Since NAV is based on the actual number of shares, it is important to re-check the number of outstanding shares prior to making any calculations.
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