When do Mutual Funds update the NAV

Gain clarity on the timing and process of when mutual fund NAV gets updated.
When do Mutual Funds update the NAV
3 min
08 March 2024

Investing in mutual funds can be a great way to potentially grow your money, but have you ever wondered how the value of your investment is determined? It is through something called the Net Asset Value or NAV. In this article, we will learn about mutual fund NAV and understand when and how it gets updated.

What is NAV?

The Net Asset Value (NAV) is like the heartbeat of a mutual fund. It represents the per-unit market value of all the securities held by the fund. Simply put, it tells you what one unit of the mutual fund is worth at a given time. NAV is crucial as it reflects the fund's overall performance.

When is NAV changed?

When considering the unit price of a mutual fund, it is crucial to understand that the value is updated daily, with varying timings for equity, debt, and hybrid funds. Unlike stocks, where prices fluctuate continuously, mutual fund Net Asset Value (NAV) is disclosed at the close of the trading day, adhering to SEBI regulations.
The following table is a simple representation of the above given information:

Type of Schemes

Time at which the NAV is updated

Liquid/ Overnight funds

11 p.m. on T day

Equity and debt funds

11 p.m. on T day

Fund of Funds

10 a.m. on T+1 day


Things you need to know about mutual fund NAV

Understanding NAV involves knowing that it is influenced by the performance of the underlying assets – stocks, bonds, and other securities. If the value of these assets goes up, the NAV goes up, and vice versa.

Here are some things you need to know about mutual fund nav

  • Dynamic value: Mutual Fund Net Asset Value (NAV) is a dynamic figure that changes daily, reflecting the fund's current per-unit market value.
  • Influenced by asset performance: NAV is heavily influenced by the performance of the fund's underlying assets, including stocks, bonds, and other securities.
  • Daily update: Unlike stock prices that change throughout the day, NAV is updated at the end of each trading day as per SEBI regulations.
  • Timing variations: Different categories of mutual funds, such as active and passive funds, have varying timings for NAV updates. The NAV upload time is same for equity, debt and hybrid.
  • Importance of historical NAV: Understanding historical NAV performance is crucial in evaluating a mutual fund's consistency and adherence to investment objectives.
  • Readily accessible: Investors can easily find NAV information on fund house websites, AMFI website, financial news platforms, or through their mutual fund distributors/brokers.
  • Complementing other indicators: While NAV is an essential indicator, it should be considered alongside other factors for a comprehensive assessment of mutual fund performance.

How do I find the NAV of a mutual fund?

Finding the NAV of a mutual fund is easy. Most fund houses display the NAV on their websites, and financial news websites also provide this information. You can also check with your mutual fund distributor or use mobile apps that offer real-time NAV updates.

  • Fund house resources: All fund houses provide NAV information on their official websites. Directly accessing the fund house's resources is a reliable way to obtain updated NAV.
  • Financial news platforms: Financial news websites regularly publish NAV details of various mutual funds. These platforms offer detailed information, keeping investors informed about NAV changes.
  • Mutual fund platforms: Mutual fund platforms like the Bajaj Finserv Platform can provide NAV information to investors.
  • AMFI website

Difference between NAV and AUM?

While NAV tells you the value per unit of the mutual fund, Assets Under Management (AUM) is the total value of all the assets the fund holds. AUM is calculated by multiplying the NAV by the total number of units issued. So, while NAV is on a per-unit basis, AUM gives you the overall size of the mutual fund.

Conclusion

Understanding when mutual funds update the NAV is essential for investors. The NAV represents the value of your mutual fund units. By staying informed about NAV changes and considering other factors, you can make more informed investment decisions. Remember, the financial world may seem complex, but with a bit of knowledge, even the uninitiated can navigate it successfully.