The expression of the
value of a company or
fund per share. In the case of a
mutual fund, this is the per share prorated value of the
securities underlying the fund. It is calculated once per day at the end of the
trading day and functions as the share price of the mutual fund for the next trading day.
In the case of an
exchange-traded fund,
closed-end fund, or
stock, this is the expression of the underlying value of the company or fund per share. That is, it is a statement of the value of the company's
assets themselves minus the company's liabilities and the difference divided by the number of
outstanding shares. One way of thinking about the net asset value per share is that it is the underlying value of the share, not the value dictated by the
supply and demand of shares. Because
cost accounting tends to undervalue the value of certain assets, the net asset value per share is usually lower than the market price of shares. It is also called the book value per share.