Discuss how the net asset value (NAV) is determined and what is meant by market-to-market.
Homework Answers
NAV for a company is determined by subtracting all the liabilities from the sum of assets. NAV is mostly popular in terms of mutual funds. In mutual funds, NAV is determined by dividing the total asset value of the fund by total number of units issued to the investor, i.e., per unit market value of the fund.
Marked-to-market: It is an accounting method in which the current value of an asset in the market. It basically means what will be the value received for an asset if sold in market today. It is also known as fair value price.
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Discuss how the net asset value (NAV) is determined and what
is meant by market-to-market.
NET ASSET VALUE NET ASSET VALUE Funds Assets / Outstanding Shares = NAV Funds Assets /...
NET ASSET VALUE NET ASSET VALUE Funds Assets / Outstanding Shares = NAV Funds Assets / Outstanding Shares = NAV Stock Shares Cur Value Total $ Stock Shares Cur Value Total $ TFD 100 $11.08 TFD 125 $12.50 ASX 125 $15.00 ASX 200 $10.00 XC 300 $11.00 XC 500 $13.00 VTY 122 $23.00 VTY 135 $22.00 Funds Assets Funds Assets Funds Shares 1000 Funds Shares 1000 NAV NAV Premium or Discount of CEF Premium or Discount of CEF (Share Price...
m The formula for computing the net asset value (NAV) of a mutual fund is: NAV=...
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The formula for computing the net asset value (NAV) of a mutual fund is: NAV= liabilities/net worth NAV- liabilities/outstanding stock NAV= net worth/outstanding stock NAV= assets/liabilities There are seven basic principles all insurance companies are subject to and include A) there must be a relationship between the insured and the beneficiary. B) the insured can profit as a result of the insurance coverage. C) the loss must be quantifiable. both A) and C)
3) Consider a no-load mutual fund with the net asset value (NAV) of $10 at the...
3) Consider a no-load mutual fund with the net asset value (NAV) of $10 at the start of the year. At the end of the year, the mutual fund has $240 million in assets with 22 million shares and its total expense ratio is 1%. 1) What is the NAV at the end of the year? Please take into account the expense ratio.(20points) During the year investors have received income distributions of Si per share and capital gain distributions of...
A closed-end fund starts the year with a net asset value of $15. By year-end, NAV...
A closed-end fund starts the year with a net asset value of $15. By year-end, NAV equals $15.40. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $1.80. a. What is the rate of return to an investor in the fund during the year? Rate of...
A closed-end fund starts the year with a net asset value of $24. By year-end, NAV...
A closed-end fund starts the year with a net asset value of $24. By year-end, NAV equals $25.30. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $2.70. a. What is the rate of return to an investor in the fund during the year? (Do not...
A closed-end fund starts the year with a net asset value of $18. By year-end, NAV...
A closed-end fund starts the year with a net asset value of $18. By year-end, NAV equals $18.70. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $2.10. a. What is the rate of return to an investor in the fund during the year? (Do not...
A closed-end fund starts the year with a net asset value of $24. By year-end, NAV...
A closed-end fund starts the year with a net asset value of $24. By year-end, NAV equals $25.30. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $2.70. a. What is the rate of return to an investor in the fund during the year? (Do not...
A closed-end fund starts the year with a net asset value of $20. By year-end, NAV...
A closed-end fund starts the year with a net asset value of $20. By year-end, NAV equals $20.90. At the beginning of the year, the fund is selling at a 4% premium to NAV. By the end of the year, the fund is selling at a 9% discount to NAV. The fund paid year-end distributions of income and capital gains of $2.30. a. What is the rate of return to an investor in the fund during the year? (Do not...
Corporate Fund started the year with a net asset value of $14.00. By year-end, its NAV...
Corporate Fund started the year with a net asset value of $14.00. By year-end, its NAV equaled $13.20. The fund paid year-end distributions of income and capital gains of $2.20. What was the rate of return to an investor in the fund? (Round your answer to 2 decimal places.) Rate of return = _______ %
A closed-end fund starts the year with a net asset value of $11.00. By year-end, NAV...
A closed-end fund starts the year with a net asset value of $11.00. By year-end, NAV equals $11.20. At the beginning of the year, the fund was selling at a 3% premium to NAV. By the end of the year, the fund is selling at a 6.5% discount from NAV. The fund paid year- end distributions of income and capital gains of $2.10. a. What is the rate of return to an investor in the fund during the year? (Do...
m
The formula for computing the net asset value (NAV) of a mutual fund is: NAV= liabilities/net worth NAV- liabilities/outstanding stock NAV= net worth/outstanding stock NAV= assets/liabilities There are seven basic principles all insurance companies are subject to and include A) there must be a relationship between the insured and the beneficiary. B) the insured can profit as a result of the insurance coverage. C) the loss must be quantifiable. both A) and C)
3) Consider a no-load mutual fund with the net asset value (NAV) of $10 at the start of the year. At the end of the year, the mutual fund has $240 million in assets with 22 million shares and its total expense ratio is 1%. 1) What is the NAV at the end of the year? Please take into account the expense ratio.(20points) During the year investors have received income distributions of Si per share and capital gain distributions of...
A closed-end fund starts the year with a net asset value of $24. By year-end, NAV equals $25.30. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $2.70. a. What is the rate of return to an investor in the fund during the year? (Do not...
A closed-end fund starts the year with a net asset value of $18. By year-end, NAV equals $18.70. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $2.10. a. What is the rate of return to an investor in the fund during the year? (Do not...
Corporate Fund started the year with a net asset value of $14.00. By year-end, its NAV equaled $13.20. The fund paid year-end distributions of income and capital gains of $2.20. What was the rate of return to an investor in the fund? (Round your answer to 2 decimal places.) Rate of return = _______ %
A closed-end fund starts the year with a net asset value of $11.00. By year-end, NAV equals $11.20. At the beginning of the year, the fund was selling at a 3% premium to NAV. By the end of the year, the fund is selling at a 6.5% discount from NAV. The fund paid year- end distributions of income and capital gains of $2.10. a. What is the rate of return to an investor in the fund during the year? (Do...
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