Similar to other asset classes, the returns on mutual funds are determined by assessing the increase in value of your investment over time relative to your initial investment. The price of a mutual fund is determined by its net asset value, which is also used to calculate returns on your mutual fund investments. The return over a period is computed as the difference between the buy date NAV and the sale date NAV, and the result is multiplied by 100 to get the return as a percentage. When calculating total returns, the net dividend* and any other income distributions made by the fund during the holding period are also included to the capital gain.
The growth in NAV over time in mutual funds reflects capital appreciation. This occurs because a fund's NAV is based on the stock prices of the firms that make up its portfolio, and those values change daily. Changes in a fund's NAV over time might cause your investment to gain or lose capital. View your account statement from the fund house to see how your investments have performed in terms of returns. Both your transactions and the return on your investments are included in this statement.
Note: *A Fund's NAV decreases to the extent of any applicable statutory levies and dividend payments.
