How do the unit trusts determine the selling and repurchase price of the units?
A. The selling price of a unit is determined by the net asset value or the NAV of the fund. The selling price also includes the sales charge. The repurchase price of a unit is also the same as the net asset value-NAV but it is less the repurchase charge, if any. The sales charge is calculated separately. It is determined by the net investment amount. In the same way the repurchase charge is also calculated by the amount of money which is withdrawn or the amount invested in repurchase. It is basically the NAV that determines the selling and the sale prices of the units of the fund. The NAV itself depends upon the value of the assets of the fund. It may increase or decrease with the change in the asset value of the fund.
