Question

The composition of the Fund XY portfolio is as follows:

Stock	Shares	Price
A	260,000	$	40
B	360,000		45
C	460,000		20
D	660,000		25

The fund has not borrowed any funds, but its accrued management fee with the portfolio manager currently totals $45,000. There are 4 million shares outstanding. What is the net asset value of the fund?

Answer 1

The NAV or net asset value is calculated using the formula"
= (Fund value - Management fee)/(Number of shares outstanding)
Fund value is the sum of the multiplications of the number of shared (for the individual stock) multiplied to the share price.
Fund value=($260,000*40 + $360,000*45 + $460,000*20 + $660,000*25)
=($10,400,000 + $16,200,000 + $9,200,000 + $16,500,000)
=$52,300,000

Management fee is $45,000
Number of shares outstanding is 4000000
NAV=($52,300,000 - $45,000)/4000000
=($52,255,000)/4000000
=$13.06375 or $13.06 (Rounded to 2 decimal places)

Answer: Hence, the net asset value of the fund is $13.06