When you make an investment in a mutual fund, the return is the most important factor to consider than anything else including tax savings and dividend income. Hence you should have knowledge in calculating the return on investment and the principles or aspects taken into consideration for the same.
Here comes the importance of the concept called NAV (Net Asset Value). Invest in a mutual fund means you purchase some units in the mutual fund scheme for a base price that can grow or shrink based on the performance. Net asset value calculation of each of the unit help you know about the performance of mutual funds.
NAV, as said above is the Net Asset Value or the value per unit of the mutual fund. It is the difference between the value of assets and value of liabilities per unit of the mutual funds on a day. You can make use of the nav formula NAV= (value of asset-value of liabilities)/number of outstanding shares. In simple words, this is the price at which you purchase and sell a single unit of the mutual fund.
Even though this is not an important criterion to judge the performance of a fund, this value helps you select the best mutual funds in the market by analyzing the fluctuation in the unit values.
NAV fluctuation is so simple. NAV increases with the increase in the rate of most of the securities in which the scheme is invested and vice versa. Good numbers of investors still think that NAV is the share price. But this not correct since share price is the price reflected in the stock market and it depends on several factors including the past performances, demand supply of a security, future prospect and more. But in case of mutual funds, the prices are NAVs and nothing else.
Get professional help:
Higher NAV does not sound good in fund performance. Most of the investors don’t give much importance to the NAV in selecting the mutual fund. Instead, give importance to the performance of the company. The reputed online platform provides professional help from experienced experts. They help you to select mutual funds with good performance in the market.
Now there is no need to take walks to the mutual fund offices since the complete range of services are provided online. Professional help is provided at free of cost and hence never hesitate to make use of it to make better decisions.
Think of risks:
Never forget the factor that mutual fund investments are subject the market risks. Hence never ignore any of the aspects when selecting the best mutual funds. It is not a bad idea to calculate the NAV of mutual funds to get an idea about the difference in the value per unit during particular periods of time.
Get the service of the reputed mutual fund online platform that provides a complete range of service online including nav formula. Be clear about all of the factors and never leave doubt behind when you make the investment on mutual funds.