The NAV calculator performs the arithmetic behind the number that a fund publishes at the end of each valuation day: total assets, minus total liabilities, divided by the shares or units in issue. That single figure is what an open-ended fund transacts at, what a fund's fact sheet reports, and what a listed closed-end vehicle's market price is measured against. The formula fits on one line, but almost every real dispute about a NAV is a dispute about the inputs rather than the division.
At Arb Digital we build free calculators that show their working rather than hiding it, and this one is deliberately built around the parts most explanations skip. You enter the assets and liabilities yourself, so nothing here depends on live market data of any kind, and the page publishes none. What it gives you is the structure: which line items belong on each side, why the share count has to be measured at the same instant as the assets, and why the premium or discount to price is a statement about two different things rather than a signal about either one.
What This NAV Calculator Does
You supply six numbers. The first two are the asset side: investments carried at fair value, and everything else the fund owns — settled cash, dividends and interest receivable, receivables for securities sold but not yet settled, and prepaid expenses. The next two are the liability side: payables and borrowings, which covers unsettled purchases, redemptions payable to investors who have already dealt, and any drawn credit facility; and accrued expenses, which covers the management fee, administration, custody, audit and any performance fee accrued but not yet paid. The fifth number is the share or unit count at the valuation point. The sixth is optional: a market price, which only means anything for a vehicle that trades on an exchange.
From those, the calculator returns net assets, NAV per share, and — where you have supplied a price — the premium or discount as a percentage of NAV. The breakdown bar shows how much of gross assets survives as net assets once liabilities are removed, which is a quick way to notice that a fund is carrying more leverage or more accrued fees than you assumed.
How to Use It
- Enter investments at fair value. This is the portfolio as the fund's own valuation policy carries it, not as you would value it. For listed holdings that is usually a closing or mid price from a named source; for anything unlisted or suspended it is a fair-value estimate under a documented procedure.
- Add the other assets. Cash, income receivable, and unsettled sale proceeds all belong here. Leaving out receivables understates NAV, and it is one of the more common errors when people rebuild a NAV from a fact sheet.
- Enter payables and borrowings. Unsettled purchases are a liability even though the securities are already on the asset side — that pairing is what keeps the calculation consistent.
- Enter accrued expenses and fees. Fees accrue daily in most funds, so the accrual at a mid-month valuation point is a fraction of the annual figure, not the whole thing.
- Enter the share count and, if relevant, a market price. Then read NAV per share from the hero figure and the premium or discount from the grid.
The Formula — How Net Asset Value Is Calculated
Net asset value is total assets less total liabilities. NAV per share is that figure divided by the number of shares or units outstanding at the same moment. The premium or discount, where a market price exists, is the price minus NAV per share, expressed as a percentage of NAV per share — positive is a premium, negative is a discount. Investor education material from the US Securities and Exchange Commission's Net Asset Value glossary entry states the same definition in the same order, and the FINRA guide to mutual funds makes the timing point explicitly: an open-ended fund strikes one NAV a day, after the markets it invests in have closed.
The reason the formula is deceptively simple is that "fair value" is doing all the work. What a fund may treat as fair value, and the hierarchy of evidence it must prefer, is set out in accounting standards rather than left to judgement — IFRS 13 Fair Value Measurement defines fair value as the price receivable on selling an asset in an orderly transaction between market participants at the measurement date, and builds a three-level hierarchy from quoted prices down to unobservable inputs. Everything contentious about a published NAV lives in that hierarchy.
A Worked Example, Line by Line
Take the defaults on the page. Investments are carried at 250,000,000, with a further 3,500,000 of cash, income receivable and unsettled sales, giving total assets of 253,500,000. On the other side, payables and borrowings are 4,200,000 and accrued expenses are 800,000, so total liabilities are 5,000,000. Net assets are therefore 248,500,000. Divided across 12,000,000 shares, NAV per share is 20.7083.
Now the optional part. If the shares change hands on an exchange at 24.10, the difference over NAV is 3.3917 per share, which is 16.38% of NAV. That is a premium. What it is not is a statement that the fund is worth more than its portfolio, or that the market disagrees with the accountants. A premium can reflect scarcity of the exposure, an income profile buyers want, a small free float, or simply that the last trade happened at a different moment from the valuation point. Persistent premiums and persistent discounts in listed vehicles are a long-studied feature of the closed-end fund structure, and no single explanation covers them.
Why the Valuation Timing Matters More Than the Arithmetic
A NAV is stated as at an instant, and every input has to be measured at that same instant. That sounds procedural until you look at a fund holding assets across time zones. If a fund valued in London holds Tokyo-listed shares, the Tokyo close happened hours before the London valuation point, and anything that moved global markets in between is not reflected in that closing price. Funds respond with documented fair-value adjustment procedures — applying a model or a proxy movement to stale prices — and different funds apply them at different trigger thresholds. Two funds holding the same Tokyo shares can therefore publish different values for them on the same evening, both correctly, both consistently with their own stated policy.
The share count has the same problem in reverse. Subscriptions and redemptions dealt at the valuation point change the denominator, and if the count you use is a day out of date the per-share figure drifts even when net assets are right. This is why a NAV rebuilt from a published fact sheet rarely reconciles to the last decimal: the fact sheet is a summary, and the summary rounds and lags.
What NAV Does Not Tell You
NAV is a level, not a performance measure. A fund that pays a large distribution sees NAV per share fall by roughly the distribution on the ex-date, which looks like a loss and is not one. Comparing NAV per share across two funds tells you nothing useful at all — one fund launched at 10 and one at 100, and the higher number is an artefact of the launch price. This is the specific misreading the FINRA material warns about, and it is common enough that fund groups address it directly in their own literature. If you want performance, total return over a stated period with distributions reinvested is the measure, and our annualized return calculator and CAGR calculator handle the arithmetic for that.
NAV also says nothing about cost. Two funds with identical portfolios and identical NAVs can leave investors with materially different outcomes over a decade because of the fee accrual that sits in the liability line. The expense ratio calculator is the right place to see that drag compounding, and the index fund calculator projects a balance net of it.
NAV in Structures Other Than Mutual Funds
The same subtraction appears across a range of vehicles, but the conventions differ enough to catch people out. An exchange-traded fund publishes an end-of-day NAV like any other fund, but also disseminates an indicative intraday value during the session, which is an estimate on a different basis and is not the NAV. A closed-end fund publishes NAV while its shares trade independently, which is where premiums and discounts come from. A private fund may strike NAV quarterly, with most of the asset side sitting at level-three fair value, so the figure is an estimate with a wide honest range around it rather than a price. And in property vehicles, adjusted measures that add back certain items are reported alongside NAV precisely because the plain figure is considered incomplete for that asset class.
The practical point is that "NAV" on its own is not a defined quantity across vehicles. Whenever you compare two, check the valuation frequency, the valuation point, and whether the number is a plain NAV or an adjusted variant. Our intrinsic value calculator covers the operating-company equivalent, which discounts future owner earnings instead of totting up today’s carrying values — a genuinely different measure despite the similar shape.
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Talk to Arb Digital All Free ToolsCommon Mistakes to Avoid
- Omitting accrued fees. Management and performance fees accrue continuously. A NAV built without them is systematically too high, and the error grows through the accrual period.
- Mismatching the share count. Using yesterday's units against today's assets produces a per-share figure that is wrong in a way no reconciliation will find quickly.
- Treating a discount as a bargain. A discount to NAV means the market price is below the accounting value. It may reflect illiquidity, gearing, governance, or doubt about the valuation itself.
- Comparing NAV per share between funds. The level depends on the launch price and any subsequent share consolidation. It carries no information about quality or value.
- Double-counting unsettled trades. A purchase not yet settled sits on both sides — the security as an asset and the cash owed as a liability. Recording only one side moves NAV incorrectly.
Related Free Tools From Arb Digital
If you are working through fund and equity valuation, the expense ratio calculator quantifies fee drag, the dividend yield calculator handles income on a stated price, the market cap calculator covers the listed-company equivalent of size, and the price to book calculator compares a market price to carrying value. For risk-adjusted comparison between funds, the Sharpe ratio calculator and the Sortino ratio calculator both take return series you supply. The full free tools hub lists everything else.
Frequently Asked Questions
Net asset value is a fund's total assets minus its total liabilities. Divided by the number of shares or units outstanding at the same valuation point, it gives net asset value per share, which is the figure most funds publish once each valuation day.
On the asset side: investments at fair value, cash, income receivable and unsettled sale proceeds. On the liability side: unsettled purchases, redemptions payable, borrowings, and accrued expenses including management, administration, custody, audit and any performance fee.
No. The subtraction is universal but the inputs follow each fund's own documented accounting and valuation policy, including its valuation point, its fair-value procedure for stale or unlisted prices, and its fee accrual convention. A published NAV is a product of that policy.
It is the gap between a listed vehicle's market price and its NAV per share, expressed as a percentage of NAV. A premium means the price is above NAV and a discount means it is below. It describes a relationship between two numbers and is not by itself evidence about either one.
No. The level mostly reflects the price the fund launched at and any later share consolidation. Comparing NAV per share across funds carries no information about performance, cost or quality. Total return over a stated period is the comparable measure.
Because cash leaves the fund. Net assets drop by the amount distributed, so NAV per share falls by roughly the per-share distribution on the ex-date. Investors are not worse off; the value has moved from the fund to their hands.
It depends on the vehicle. Open-ended funds and ETFs typically strike a NAV each dealing day after the relevant markets close. Some private and property vehicles value monthly or quarterly, and their NAVs rest more heavily on fair-value estimates rather than quoted prices.
This tool performs arithmetic on figures you enter and is for general education only. It is not investment, tax, accounting or legal advice, and it publishes no market data. A fund's official NAV is determined by that fund's administrator under its own valuation policy. Speak to a licensed professional before making any decision.
