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How NAV of a mutual fund is calculated everyday

1. How NAV of a mutual fund is calculated everyday (Equity & Debt)? 2.If one invest in a mutual fund on Saturday, will one get appreciation for Saturday & Sunday as the NAV will be calculated from the next Monday?

Aug 22, 2016 by R Khedia, Vadodara  |   Mutual Fund

1. Please go through the following links to know more about NAVs of mutual funds –



2. Please note that one can not invest in mutual funds on Saturday. The NAV of equity or equity oriented mutual funds are calculated on the days the stock markets are open. NAVs are calculated post market closure based on the closing prices of the securities held in the portfolio. Therefore, the equity oriented mutual funds do not earn anything on Saturdays and Sundays. For example – if you invest in an equity oriented mutual fund on Friday, you will get the purchase NAV of Friday and if you sell the units on Monday then you will exit at the NAV of Monday. That means your investment will not earn anything or there will be no activity in this investment on Saturday and Sunday as the stock markets remain closed on these two day.

However on the other hand, debt / liquid mutual funds earn returns even on weekends as the investments are mostly in fixed income securities such as bonds, commercial papers (CP), certificate of deposits (CDs), debentures and Government securities across different maturity profiles. These securities earn interest each day and therefore even if the stock markets are close or NAVs are not calculated, these funds continue to earn returns. Therefore, the appreciation of Saturday, Sunday or holidays will reflect on the next day when the NAV is declared.

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