The price of a unit or share corresponds to the
net asset value (NAV)
divided by the number of units issued. If the value of the fund assets increases, so does the price of
the individual units.
The fund management company calculates and publishes the net asset value on a daily basis and in some
cases on a weekly basis. In the case of exchange traded funds, a third-party company appointed by the
issuer calculates the indicative net asset value (iNAV).
Creation and redemption process for ETFs and ETSFs
The following special features apply to the creation and redemption of units of ETFs
(active and passive) and ETSFs compared to conventional investment funds:
Market makers have the option of acquiring new units directly from the fund company. The fund
company then creates new units. The proceeds are then invested in the fund's investment
instruments. This process increases the net asset value and the number of units issued
Investors may request that the fund company redeem their units. This reduces the fund's assets
by the number of units redeemed (redemption process). The creation and redemption
of units in the primary market ensures that the ETF (active and passive) or ETSF is traded at
a price that is close to the indicative net asset value (iNAV) of the secondary market.