How DSP BlackRock Mutual Fund Nav Calculation is Done?

NAV is an acronym for Net Asset Value. If you would’ve eavesdropped on a conversation between an advisor and an investor, NAV would have popped several times. It is the cost of the fund's per unit market value. Investors buy and sell securities at the NAV of fund. If you wish to buy DSP BlackRock mutual fund units, you will have to do it at the present day NAV of the fund. In the same way, you will have to sell the units at the prevalent DSP BlackRock Mutual Fund NAV. Different schemes of BlackRock have different NAV. Based on the performance of the fund, the NAV increases or dips. Now that we are clear about what NAV is, let’s jump on to how BlackRock Mutual Fund NAV calculation is done.

What is the formula for Calculating BlackRock Mutual Fund NAV?

Mathematics is still a nightmare for me. But this calculation is a boon for us. It is just basic division. Two things are required to calculate the DSP BlackRock Mutual Fund NAV  total net assets of and the total number of outstanding shares. To determine the total net assets, DSP BlackRock subtracts any liabilities from the fund’s total assets.

NAV = (Total Assets - Liabilities) / Total Number of Outstanding Shares

For instance, if the market value of securities held by the fund is INR 800 lakh and the mutual fund issues 40 lakh units of INR 10 each. Then, BlackRock Mutual Fund NAV will be INR 20.

When is DSP BlackRock Mutual Fund NAV Calculated?

Calculating the NAV during market hours is impossible as the prices of the stocks held by the mutual funds (underlying stocks) changes from time to time. This is the reason why NAV calculation for all of the DSP mutual funds is done at the end of the day. End of the day calculation of NAV helps to take into account the closing prices of all the stocks that is being held by DSP Mutual Fund.

How is DSP BlackRock Mutual Fund NAV Relevant to Investors?

This is the price at which investors buy or sell the units of BlackRock mutual fund scheme. So obviously, it is highly relevant because it indicates the number of fund units an investor will receive. But some investors often mistake NAV for the share price. They think both work the same way. New investors think that they have got a good deal when they buy fund units at lower NAV. But this doesn’t make sense. It makes sense in the case of stocks as you get a bargain deal there. It is hard to judge whether a fund is expensive or cheap by its NAV; or its performance also. However, if a particular DSP fund is consistently performing well, then the NAV can be used as an indicator to gauge the fund’s performance.  if you want to judge the return of DSP mutual fund scheme, do it by the return it has provided over the years rather than judging it by its NAV.

Disclaimer: Mutual Fund Investments are subject to market risks, kindly read all scheme related documents carefully before investing.