1. What Is NAV?
NAV stands for Net Asset Value — it’s basically the price of one unit of a mutual fund.
Think of it like the share price of a mutual fund.
Formula:
\text{NAV} = \frac{\text{Total Assets – Total Liabilities}}{\text{Total Number of Units}}
So, if a mutual fund’s total assets are ₹100 crore and it has 10 crore units,
NAV = ₹10 per unit.
2. How NAV Changes
NAV changes every business day based on how the investments (stocks, bonds, etc.) in the fund perform.
If the fund’s portfolio value goes up → NAV increases.
If it goes down → NAV decreases.
Example:
If your fund’s NAV was ₹10 yesterday and today it’s ₹10.20, that means the fund grew by 2% in a day.
3. Does a Lower NAV Mean a Cheaper or Better Fund?
No, it doesn’t.
A common mistake is thinking a lower NAV fund is “cheaper” or gives “higher returns.”
What actually matters is the fund’s performance, not the NAV amount.
Two funds (one with ₹10 NAV and one with ₹100 NAV) can give exactly the same return percentage-wise.
For example:
- Fund A (NAV ₹10) → grows 10% → ₹11
- Fund B (NAV ₹100) → grows 10% → ₹110
Both give a 10% return.
4. Why NAV Matters
- It tells you the current value of your mutual fund investment.
- When you invest, you buy units based on the NAV that day.
- When you redeem, you sell units at the latest NAV.
- It helps calculate your profit or loss.
Example:
You bought 100 units at ₹20 NAV = ₹2000 invested.
Now NAV = ₹25 → your investment is worth ₹2500 → profit ₹500 (25%).
5. How to Check NAV
You can check the latest NAV:
- On AMFI (amfiindia.com)
- On your mutual fund app or website
- On Moneycontrol, Groww, or ET Money
NAVs are usually updated daily around 9 PM for most mutual funds.
6. The Bottom Line
NAV is simply the value per unit of your mutual fund — not a measure of how “good” it is.
When choosing a fund, focus on:
- Past performance (3–5 years)
- Consistency of returns
- Expense ratio
- Fund manager and strategy
A low NAV won’t make you rich — smart investing will.
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