A portfolio is worth ₹72,000. The fund has earned dividends of ₹3,000 and incurred expenses of ₹600. There are 6,000 units. What is the NAV?
"Mutual fund" means the common pool held in a trust (investors are the joint beneficial owners, supervised by trustees) and also the fund house. SEBI classifies schemes into five groups: equity, debt, hybrid, life cycle funds and others, and allows only one scheme per category, except index funds/ETFs on different indices, fund of funds with different underlying schemes, and sectoral/thematic funds on different sectors or themes.
Worked example
Investors put in ₹10,000, ₹20,000 and ₹30,000 (6,000 units at ₹10). The portfolio grows to ₹72,000, with ₹3,000 of dividends and ₹600 of expenses. Net assets = 72,000 + 3,000 − 600 = ₹74,400. NAV = 74,400 ÷ 6,000 = ₹12.40.