The correct answer is: A. both realized and unrealized capital gains.
Net asset value (NAV) is the total market value of a fund’s assets minus its liabilities, divided by the number of shares outstanding. It is calculated at the end of each trading day and represents the per-share value of a fund’s investment.
NAV takes into account both realized and unrealized capital gains. Realized capital gains are the profits that a fund has made from selling assets. Unrealized capital gains are the profits that a fund would make if it sold all of its assets at their current market value.
For example, let’s say that a fund has $100 million in assets and $10 million in liabilities. The fund has $90 million in net assets. If the fund has $10 million in realized capital gains and $20 million in unrealized capital gains, the NAV would be $110 per share.
It is important to note that NAV is not the same as market price. Market price is the price at which a fund’s shares are actually trading. NAV is often lower than market price because it does not take into account the fees that a fund charges.
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