Net Asset Value (NAV) is a financial metric that represents the value of an entity’s total assets minus its total liabilities. It is commonly used in the context of investment funds, real estate, and businesses to assess their worth.

Characteristics
– Calculation: NAV is calculated by subtracting total liabilities from total assets.
– Valuation: It provides a snapshot of the company’s financial health at a specific point in time.
– Relevance: NAV is often used by investors to determine the value of an investment or to compare different investment opportunities.

Examples
– Investment Funds: In mutual funds, NAV per share is calculated daily, allowing investors to see the value of their shares based on the fund’s total assets and liabilities.
– Real Estate: A real estate investment trust (REIT) may calculate its NAV to help investors understand the underlying value of its properties after accounting for debts.
– Business Valuation: A company looking to sell may calculate its NAV to provide potential buyers with a clear picture of its asset value, excluding any liabilities.