How NAV Works

NAV (Net Asset Value) is the price of one unit of a mutual fund. It's calculated at the end of every business day.

The Formula

NAV = (Total Assets - Total Liabilities) / Total Units Outstanding

If a fund holds stocks worth ₹100 crore and has 10 crore units, each unit's NAV = ₹10.

Common Misconception: "Low NAV = Better Deal"

This is the #1 beginner mistake. A fund with NAV ₹15 is NOT cheaper than one with NAV ₹500.

Example: You invest ₹10,000 in two funds:

Fund A: NAV ₹10, you get 1,000 units
Fund B: NAV ₹500, you get 20 units

If both funds grow 20% in a year:

Fund A: 1,000 × ₹12 = ₹12,000 (profit ₹2,000)
Fund B: 20 × ₹600 = ₹12,000 (profit ₹2,000)

Same return. NAV level is irrelevant — what matters is the percentage growth.

When NAV is Updated

NAV is calculated once per day after market close (3:30 PM IST)
Published by 8:00 PM IST on the AMFI website
On holidays/weekends, the last working day's NAV applies
For purchases before the cut-off time (usually 3:00 PM), you get that day's NAV

NAV Impact of Expenses

The NAV already accounts for the fund's expense ratio. If a fund earns 12% gross return but has a 1.5% expense ratio, the NAV growth reflects ~10.5% net return.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully. Past performance is not indicative of future returns.