How to Compute Your Mutual Funds Earnings

Today, most Filipinos are becoming interested and are starting to invest on Mutual Funds. Some of them may already know how to compute their mutual funds earnings but most of them still does not know if they are earning from their Mutual Funds or not.

Mutual Funds in the Philippines

Investment companies that offers Mutual Funds in the Philippines

To help those still confused or do not know how to compute their earnings in Mutual Funds, here are three simple steps you may follow:

  1. Know how many shares you have in the fund
    The first thing you should do for you to compute your mutual fund’s earning is to determine how many shares you own in the fund you want to redeem from. Let’s say, you have 10,000 pesos to buy shares from your chosen Mutual Fund and the Net Asset Value per share on that day was 2.50 pesos per share. The formula you need to follow would look like these:

    • Number of shares= Amount to be invested / NAVPS of the day of purchase
    • Number of shares= 10,000 pesos / 2.50 pesos per share
    • Number of shares= 4,000 shares


    If you decide to buy more shares and you have another 10,000 pesos to purchase more shares but the NAVPS on that day increases, and now it is 2.75 pesos per share. You will still have to do the same procedure and divide 10,000 pesos by the NAVPS of that day (10,000 pesos / 2.75 pesos per share), the result would be 3636.36 or 3636 only, the investment company would return the extra 1 peso to you more shares to you. (2.75 pesos per share x 3636 shares = 9999 pesos only)

    For you to know how many shares you now have, just add all those shares up:

    • Updated number of shares= Recently bought shares + Previous shares bought
    • Updated number of shares= 4,000 shares + 3,636 shares
    • Updated number of shares=7,636 shares
  2. Know the current Net Asset Value per share (NAVPS)
    Knowing the NAVPS is very important because it will be the one determining if you are really earning on your investment or not. If you bought your shares when the NAVPS was 2.50 pesos, then after several months you decided to redeem your shares and the NAVPS on that day is 3.00 pesos then congratulations, you will be earning not losing money.To make it simple for you, if the NAVPS that day is higher than the NAVPS when you bought your shares, then you will be earning. If it is lower, then you have lost some of your money.
  3. Calculate your earnings
    To calculate your earnings you must first know these things:

    • Number of shares at time of redemption
    • NAVPS at time of redemption

    There are two formulas you may follow to compute for your profit and your total earnings:

    1. Profit = (Current NAVPS – Original NAVPS) x Number of Shares
    2. Total Earnings = Amount you Invested + Profit

    For example, the NAVPS when you purchased was 2.50 pesos and after a year, you decided to redeem your shares and the current NAVPS was 3.00 pesos. You have invested 10,000 pesos and the number of shares you were able to acquire was 4,000 shares.

    Your computation would look like this…

    Formula #1:

    • Profit = (Current NAVPS – Original NAVPS) x Number of Shares
    • Profit = (3.00 pesos per share – 2.50 pesos per share) x 4,000 shares
    • Profit = .50 pesos per share x 4,000 shares
    • Profit = 2000 pesos

    Formula #2

    • Total Earnings= Amount you Invested + Profit
    • Total Earnings= 10,000 pesos + 2,000 pesos
    • Total Earnings= 12,000 pesos

So, there you have it, three easy steps on how to compute your Mutual Funds earnings. Remember to always check on your investments regularly, to know if you are earning or if you are losing your money.

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Mark Ross Canaoay

Hello! My name is Mark and I'm the one responsible for this website. I'm just a person with enough knowledge about finance-related stuffs. You can know more about me by liking my Facebook Page, following me on Twitter or by adding me in one of your circles on Google+.

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