What is net asset value?

Zoomer | January 1st, 2006

Q – Would you explain what the NAV (net asset value) means and what its implications are for investment trusts?  – J.S.


A – The NAV is the actual value of an investment portfolio, corporation, trust etc. calculated on a per share basis. Closed-end trusts normally trade at a discount to NAV but occasionally they will move to a premium if investors perceive there is strong growth potential. Open-end mutual funds are always bought and sold at their NAV. – G.P.