The pricing of unit trusts can be a bit complex
Unlike financial instruments such as shares listed on the stock exchange, a unit trust
fund will likely only quote its price at the end of each day.
With unit trusts, chances are there will be a single price quoted, rather than a buy-sell spread. You can use this value as a basis, but it’s not that accurate.
And if you sell, you may have to pay a fee, especially if you’ve not held the holding for very long.
The fee will take into account any expenses the fund has to pay when it sells your underlying investments.
So it’s very hard to get an accurate value of your unit trusts until you actually sell them. And that’s also down to the changing underlying market values, David Thornton in Penny Sleuth explains.
You need to apply a discount to what you think your unit trusts are worth
If you’re planning to sell your unit trust holdings, it makes sense to apply a discount to these holdings. This will allow for fees and stock market value changes.
With unit trusts there’s also the chance that a fund manager will suspend dealing if there’s a wave of selling in the fund. This is to protect the remaining unit trust holders.
When you sell your unit trust holdings, or any other financial instruments for that matter, the values you believe are accurate may not be. So if you’re valuing your portfolio, it makes sense to be prudent about it.
Otherwise you may be disappointed with the values you receive once you sell.
So there you have it, how to calculate the value of your unit trust holdings if you’re planning to sell them.
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