Net asset value is what remains when you take everything a fund or company owns and subtract everything it owes. For mutual funds and similar products, that total is then divided by the number of units so investors can see a price per unit. It is a book-style measure of worth, not a guarantee of what you could sell for in the open market.
Key takeaways
- NAV is assets minus liabilities, often expressed per share or unit.
- Fund NAVs are typically calculated at the end of each trading day.
- A listed company’s market price can sit well above or below its NAV.
- Always check what is included in assets and liabilities before comparing two NAVs.
Why it matters in Ethiopia
As more funds and listed companies appear on the Ethiopian Securities Exchange, NAV helps you judge whether a unit price looks rich or cheap relative to the underlying holdings. It is especially useful when reading fund fact sheets and annual reports.