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Vanguard Fund Price Calculation
Old 01-21-2008, 07:50 PM   #1
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Vanguard Fund Price Calculation

Can someone explain how a mutual fund NAV is calculated when a fund is bought?

Real question is if I place an order at 10AM or 2AM tomorrow, will my buy in price differ or is it calculated at days end?

I may buy the VTI index and need some guidance on that issue.
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Old 01-21-2008, 07:53 PM   #2
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Fund prices are calculated at days end on the day purchased.
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Old 01-21-2008, 08:14 PM   #3
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REW,
thanks. That what I just told a friend but wanted to confirm. But that seems very strange cause the buyer and seller are basically blind to what they are receiving.

So if I wanted VGTSX, place and order early, it might end up the day being a bargain or a bust.

But if I wait till 3PM, I'll have a better idea of what I might get.

Strange.

But again, I appreciate that info.



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Fund prices are calculated at days end on the day purchased.
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Old 01-21-2008, 08:17 PM   #4
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Originally Posted by Puppy Belly View Post
So if I wanted VGTSX, place and order early, it might end up the day being a bargain or a bust.

But if I wait till 3PM, I'll have a better idea of what I might get.
Exactly.
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Old 01-21-2008, 08:25 PM   #5
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Some fund families have different cut off times for funds, some are a bit earlier. Check with the funds policies and whoever you're trading through.

This is what a lot of the fund families got in trouble over a few years ago. Some were allowing 'special' customers to see the >4pm closing price and then decide if they wanted a buy/sell order allegedly made earlier in the day to post as though it had been made earlier...
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Old 01-21-2008, 08:48 PM   #6
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VTI is an ETF. The price you pay for that is just like a normal stock price, and you own the shares immediately any time of the trading day. It may be higher or lower than the NAV, which is still available once a day. Different from a normal fund, and could be riskier with the sparsely traded ETF's.

Dan
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Old 01-21-2008, 08:56 PM   #7
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CFB, and REW,
thanks for the info and the candor.

I seem to recall some financial author had recently written a book that took Mutual Funds to task.

But I blew it off as "yeah, right". Maybe I should find a copy for the wife. I really need some reasoning to get her energized to be watchful.

Hope the market goes into neutal/holding.

I hope trading gets suspended. Seems this holiday puts the US at risk.

Hey, what the hey, if funds can after price. Wall street should take a page and say, hey, all prices are frozen till we decide to trade again. Nice.

Again, thanks.
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