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Fund Meaning

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Definition

Fund Value is the total value of the units in segregated funds. The total monetary worth of the units owned by the policyholders, like under the ULIP plan, is called a fund value.

Description

The fund value is the total amount of funds the policyholder owns after investing the money in funds over the years. It can be computed by multiplying the net asset value of each unit by the number of units a person owns.

Fund Value = Total Number of Units under a policy x Net Asset Value.

The fund value keeps changing based on the NAV. The total amount of monetary value of the investment is the fund value. With time, often it is said that the fund value increases over time. Depending on the plan, the fund value can be guaranteed or variable

The total amount of fund value is provided to the policyholder either on the policyholder's demise, policy surrender, and policy maturity

Example

Rakesh owns 100 units in the MNC fund, where he invested the money. The fund's net asset value at the moment he invested was Rs.8/-. But now, the fund's Net Asset Value has increased to Rs.15/-. So the total fund value Rakesh owns is Rs.15,000/- from the time he started investing.

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