Pricing, Valuation & Dealing

The NET ASSET VALUE (NAV) of a fund is the market value of ALL its assets MINUS all its liabilities. Assets include the securities held, cash, and income receivable (such as accrued dividends and interest); liabilities include fees payable, expenses accrued and amounts owed.

The NAV PER UNIT is the figure that matters for dealing. It is the fund's total net asset value divided by the number of units in issue:

• •NAV per unit = (Total assets − Total liabilities) ÷ Number of units in issue.
• •Because it is a per-unit share of the fund's net worth, NAV per unit rises and falls with the market value of the underlying portfolio.

The portfolio is marked to market at each VALUATION POINT — a set time (typically once per business day) at which the fund's assets are valued to strike the NAV. The frequency and timing of valuation are set out in the fund's constituting and offering documents.

At the valuation point the manager (or an independent fund administrator/trustee) values each holding, usually at the last traded or an agreed reference price, converts foreign-currency assets at prevailing exchange rates, adds cash and accrued income, then deducts liabilities and accrued fees such as the management fee and trustee fee.

Independent oversight matters: for authorised schemes the TRUSTEE (or a custodian/depositary) safeguards assets and helps ensure units are correctly valued and priced, protecting investors from mispricing.

Where a market is closed, illiquid or a quoted price is unreliable or stale, the manager may apply FAIR-VALUE pricing — a reasonable estimate of what the asset would fetch — under the fund's valuation policy, rather than a distorted last price.