What Is NAV Per Unit?

NAV per unit is the current price of a single unit of an investment fund. It is found by dividing the fund's total value by the number of units in circulation. In other words, the combined value of everything the fund owns, split across however many units exist, is what one unit is worth. Your buy and sell orders are executed against this price.

How is it calculated?

The calculation has two steps.

First, the total fund value is determined. On the valuation day, the portfolio assets (equities, bonds, repo, deposits, gold and so on) are valued at that day's market prices; the fund's receivables are added and its payables are subtracted. For the size of the portfolio, see fund net assets.

Then this amount is divided by the number of units in circulation that day:

NAV per unit = Total fund value ÷ Units in circulation

For example, if a fund's total value is 100 million TL and 50 million units are in circulation, one unit is worth 2 TL. These figures only illustrate the formula; they are not any real fund's current value.

Why does it change every day?

NAV per unit moves together with the prices of the assets in the portfolio. The shares, bonds and other holdings gain or lose value each trading day; in addition, the interest, dividends and profit shares the assets generate are booked as fund income the same day. That is why the value changes from one day to the next. Expressed as a percentage, this change is the fund's return. Because it is an investment fund, the unit price is, as a rule, computed once a day rather than continuously like a listed stock.

The daily calculation and disclosure requirement

Under the Capital Markets Board's Communiqué III-52.1 on the Principles of Investment Funds, the unit value must be calculated and announced every business day. It is disclosed on the Public Disclosure Platform (KAP) and at the places where units are bought and sold. Funds' unit values and historical prices can also be followed on TEFAS. So the price is not a number set arbitrarily by a single institution; it is a value computed under defined rules and made public.

The price your order divides into

When you put money into a fund, the amount you invest is divided by the NAV per unit and you receive units in return. When you sell, the number of units you hold is multiplied by the NAV per unit applicable to that trade. This price is the number that determines how many units you receive, or how much your units are worth in lira.

Forward pricing: the price is unknown when you place the order

Most funds use forward pricing. This means that at the moment you place an order you do not know the price at which you will trade; the trade executes at the NAV per unit computed at the end of that day (for some funds, the next business day). Certain funds, such as money market funds and short-term debt instrument funds, may fall outside this rule.

Which price your order takes depends on when it is placed and on the fund's order cutoff time. You can see a fund's buy/sell cutoff times and valör (how many business days until it reaches your account) on the Fund Trading Hours page. An order placed before the cutoff takes that day's price; one placed after takes the next price.

In short

NAV per unit is the fund's total value divided by the units in circulation; it is calculated and announced every business day, moves with the portfolio, and is the price your orders divide into. Understanding it is the basis for understanding why a fund rises or falls and how your order is priced.