Net Asset Value

A mutual fund's net asset value (NAV), or the dollar value of one share of the fund, tells you what the fund is worth based on the value of its underlying investments. NAVs change over time as the stock and bond markets move up and down, and the number of outstanding shares changes, though day-to-day differences may be small.

Unlike the market prices of stocks and exchange-traded funds (ETFs), a mutual fund's NAV is updated only once a day. The value is determined at 4 p.m. Eastern Time - at the end of each trading day - and remains in effect until the next trading day's close.

NAV is calculated by:

  1. Multiplying the final prices of each of the underlying investments by the number of shares in each of the investments the fund own
  2. Subtracting operating expenses from the sum of these amounts
  3. Dividing that number by the number of outstanding shares

Investors should consider the investment objectives, risks, charges, and expenses of a mutual fund or Exchange-Traded Fund (ETF) carefully before investing. A prospectus contains this and other information. A mutual fund prospectus is available through or through a Scottrade branch office. An ETF prospectus can be obtained directly from the issuer. The prospectus should be read carefully before investing.