How the Share Price is Calculated

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How the Share Price is Calculated

How the Share Price is Calculated

Investors can buy and sell shares in a mutual fund on any trading day. The fund’s share price is calculated according to its net asset value at the end of every trading day. If the price was $2 at the end of yesterday’s trading, and the stocks held by the fund rise 5% today, the fund’s share price also rises 5% to $2.10.

An investor buying 1,000 shares at this point will be charged $2,100, and $2,100 will be deposited in the account of an investor selling the same number of shares. It is impossible to buy or sell the fund’s shares at yesterday’s price. Each fund calculates its share price at the end of each day, and the prices are published in the newspapers on the following morning.

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