NAV Rs 10 or Rs 100, which one is cheaper
Source: IRIS (23-APR-12)
There is no such thing that is costly or cheap NAV.
I decided to invest in mutual funds. There were two choices before me; Fund A with an NAV of Rs 13 a unit and Fund B with a NAV of Rs 22 a unit.
Was Fund A a better choice because it was cheaper? This is a question which plagues many first- time investors in mutual funds.
Well it is irrelevant how high or low the NAV is. This seems difficult to accept but it is better explained by understanding what is NAV.
NAV stands for Net Asset Value. At the simplest level it is the sum of all assets held by the scheme divided by the number of units. Let`s take an example. When markets plunged to abysmal depths the NAV of this fund was 22. Another Fund B, holds the same stocks, its NAV was much lower at 13.