The Term NAV or Net Asset Value is used by investment companies for measuring net assets. This value is calculated by subtracting liabilities from the value of a fund’s securities and other items of value and dividing this from the number of outstanding shares. This value is commonly used in newspaper mutual fund tables for allocating the price of per share for the fund. NAV is used in relation to collective investment schemes and it may also be used as a synonym for the firm’s book value.
Net Asset Value is calculated every day when the share market takes place and the closing market value of all securities owned with all other assets for example cash, subtracting all the liabilities and then dividing the result (total net assets) with the total number of outstanding shares. Calculation of mutual fund NAV is very simple. It is typically calculated on a per-share basis. The formula for calculation is as under: -
NAV = (Market Value Of All Securities Held by Fund + Cash and Equivalent Holdings - Fund liabilities)/ Total Fund Shares outstanding
Net Asset Value of the fund will change daily as the value of the securities of a fund, cash held, liabilities and the numbers of shares outstanding fluctuate. For example, if a fund had net assets of Rs.50 lakh and there is one lakh shares of the fund, then the cost of per share will be Rs.50.00.
Monday, April 13, 2009
Thursday, April 9, 2009
Travel Insurance - What To Ask Before Buying It
Travel insurance is essential for those people who frequently travel for their business trip or world tour. This insurance plan brings many advantages for the policyholder such as medical expenses, personal accident, loss of delay of baggage or passport, financial emergency assistance, cancellation of trip or flight and much more. Travel insurance gives a protection cover against loss, injury, damage or expense caused by accident, sickness, theft etc. during the insured person’s trip. It can be arranged at the time of booking of a trip cover.
Today there are numerous travel insurance plans provided by different insurance companies. So an individual should understand different insurance policies. You should select that policy that is only for the number of the days of the trip. This is charged usually on the slab basis. You don’t just compare the prices of the insurance policy, but also ask your Insurance expert for the benefits of the cover, the exclusions on the cover and other features. You should give importance on the claims procedure and the cashless facility. Before purchasing any insurance policy, you should understand the terms and conditions of the policy. You can also check that is that cover for terrorism, hijack distress allowance etc. or not. In other words, if you consider all these things, you can select the best insurance plan for you.
Today there are numerous travel insurance plans provided by different insurance companies. So an individual should understand different insurance policies. You should select that policy that is only for the number of the days of the trip. This is charged usually on the slab basis. You don’t just compare the prices of the insurance policy, but also ask your Insurance expert for the benefits of the cover, the exclusions on the cover and other features. You should give importance on the claims procedure and the cashless facility. Before purchasing any insurance policy, you should understand the terms and conditions of the policy. You can also check that is that cover for terrorism, hijack distress allowance etc. or not. In other words, if you consider all these things, you can select the best insurance plan for you.
Monday, April 6, 2009
Employee’s Deposit Linked Insurance – What Is It?
All employees, who come under the Employee’s Provident Fund and miscellaneous Provision Act, 1952, can have a statutory liability to subscribe to Employee’s Deposit Linked Insurance 1976 that provides the benefits of life insurance to all the employees. Under this scheme, the insurance benefit is equal to the average balance to the credit of the deceased employee in the Provident Fund from the last 12 months. In EDLI, every company will give 0.50% contribution of each employee’s salary. So, if you are drawing Rs.10, 000 per month, then your company will pay Rs.50 a month towards your insurance policy.
But what are the advantages of you to take this plan. The main benefit is that each employee is covered for a sum assured that ranges between 5,000 to 62,000 which depends on your current salary and service. Employee’s Deposit Linked Insurance also gives the double accident benefit that can be allowed to the extent of the sum assured for an extra premium at the rate of Rs.0.75 per thousand sum assured per annum. But it should not be more than Rs.4.5 lacs. This insurance plan gives assurance benefits that means a payment linked to the average balance in the PF account of an employee. If you are paying provident fund from your salary, then you are eligible for life insurance under this scheme.
But what are the advantages of you to take this plan. The main benefit is that each employee is covered for a sum assured that ranges between 5,000 to 62,000 which depends on your current salary and service. Employee’s Deposit Linked Insurance also gives the double accident benefit that can be allowed to the extent of the sum assured for an extra premium at the rate of Rs.0.75 per thousand sum assured per annum. But it should not be more than Rs.4.5 lacs. This insurance plan gives assurance benefits that means a payment linked to the average balance in the PF account of an employee. If you are paying provident fund from your salary, then you are eligible for life insurance under this scheme.
Thursday, April 2, 2009
Annuities – Plan for Your Future
Today, annuity is one of the most popular investment products. This is a contract between an insurance company and the insured person in which you make a lump-sum payment or series of payments. In return, the company will agree to make periodic payments to a policyholder beginning immediately or some future date. These insurance plans offer tax-deferred growth of earnings and death benefits. We can divide these annuities into two types i.e. fixed and variable.
In this fixed annuity, the insurance company gives a guarantee that an individual will earn a minimum Interest rate at the time when his account is growing. The insurance company also gives a guarantee that the periodic payments will be a guaranteed amount in one’s account. These payments may be for a particular time of period such as 10 years, 20 years etc.
Whereas in the variable annuity, a person can choose to invest his purchase payments from among a range of different investment options specially mutual funds. The return rate on the purchase payments and the periodic payment’s amount one will receive eventually and it depends on the performance of the investment options which you have selected. Variable annuities are the securities that are regulated by the SEC but fixed annuities are not. At last, I suggest you to choose the best annuity options according to your requirements.
In this fixed annuity, the insurance company gives a guarantee that an individual will earn a minimum Interest rate at the time when his account is growing. The insurance company also gives a guarantee that the periodic payments will be a guaranteed amount in one’s account. These payments may be for a particular time of period such as 10 years, 20 years etc.
Whereas in the variable annuity, a person can choose to invest his purchase payments from among a range of different investment options specially mutual funds. The return rate on the purchase payments and the periodic payment’s amount one will receive eventually and it depends on the performance of the investment options which you have selected. Variable annuities are the securities that are regulated by the SEC but fixed annuities are not. At last, I suggest you to choose the best annuity options according to your requirements.
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