Definition
The per-share value of a fund: total assets minus liabilities, divided by shares outstanding. Mutual funds price and trade at NAV once a day after markets close; ETFs trade all day at market prices that hover near NAV.
Why it matters
NAV is why a mutual fund order placed at noon fills at a price set that evening, and why an ETF can trade at a slight premium or discount to what it holds. Knowing the difference prevents confusion the first time an order fills at an unexpected price.
Example
A fund holds $500 million of stocks and cash, owes $2 million in expenses, and has 24.9 million shares outstanding: NAV is $20 per share. An investor's $5,000 order placed that afternoon buys 250 shares at that evening's NAV.
Related terms
This definition is educational, not financial, legal, or tax advice. U.S. rules and limits change; verify time-sensitive details with official sources. See our disclaimer.