Price vs NAV
Definition
Price is what a buyer pays another holder for a token or share on a trading venue; net asset value (NAV) is the fund's own calculation of what each unit's share of the portfolio is worth at a stated valuation time. The two can differ. When the market price is above NAV the token trades at a premium; when it is below, at a discount, each usually expressed as (price minus NAV) divided by NAV. For tokenized funds the gap is driven mostly by access and timing: only eligible, onboarded holders can subscribe or redeem with the fund at NAV, the fund strikes NAV once a day or less while tokens can trade around the clock, and redemption may be capped, delayed or suspended. Where anyone who sees a gap can redeem or subscribe at NAV, arbitrage keeps price close to NAV; where they cannot, the gap can persist.
Why it matters
Tokenization is often sold on liquidity: the token can trade any time on a public chain. Trading at any time is not the same as trading at NAV. A holder who sells on a venue gets the venue's price, and a buyer who acquires a fund token from another holder may pay more than the fund would charge a subscriber. The gap matters most where redemption access is narrow. Fund tokens that can only be redeemed by allowlisted holders, notes sold only outside the US that circulate on public exchanges, and single-property tokens with no published valuation can all trade far from any measure of underlying value, and the holder bears that difference. Before buying a fund token from a venue rather than from the fund, compare the price with the latest NAV adjusted for accrued income, and check whether you could redeem at NAV if you needed to.
Common misconceptions
- •A token price close to NAV in calm markets does not guarantee it in stress. When redemptions are capped or slowed, discounts can open quickly.
- •The original offering price is not NAV. Comparing a secondary price with the launch price shows the change since issue, not a discount to current value.
- •A premium is not a sign of value. Buyers pay premiums when they cannot subscribe directly, and they can lose it if access widens or demand falls.
- •Arbitrage does not close gaps for everyone. It works only for participants eligible to subscribe or redeem at NAV, at a cost below the gap.
- •Price and NAV must be compared at the same time. A daily NAV is hours old by the evening; income accrued since then belongs in the comparison.
Technical details
Worked comparison: secondary purchase vs redemption at NAV
Facts: a Treasury fund token has a NAV of $10.0000 struck at 4:00 p.m. ET; the fund earns about 4.0% a year, roughly $0.0011 per token per day.
Overnight, an investor buys 10,000 tokens on a venue at $10.08 (a 0.80% premium), paying $100,800.
Next day, the NAV is about $10.0011. If the investor redeems, the fund pays $100,011, a loss of $789 or about 0.78%, before any fees.
Reverse case: buying at $9.92 (a 0.80% discount) and redeeming at $10.0011 gains about $811, but only for a holder eligible to redeem, before redemption fees, conversion costs and any delay.
Lesson: the next NAV, not the last trade, is the reference for anyone who can transact with the fund.
What drives the gap
Access: who may subscribe and redeem at NAV (accredited investors, qualified purchasers, non-US persons only) versus who can trade the token on a venue.
Timing: NAV is struck once a day or less; markets trade continuously, so news and accrued income move the price between valuations.
Redemption terms: notice periods, daily caps, fees, minimums, gates or suspension rights raise the cost of closing the gap.
Liquidity: thin order books and wide spreads mean the last trade may not be a price anyone could deal at now.
Settlement asset: if redemption pays in a stablecoin, its own price and redemption add a further step.
Examples from AltStreet's reviews
Robinhood Ventures Fund I: a listed closed-end fund with no redemption right; its October 2026 filing reported a $29.20 NAV per share at September 30, 2026, while holders exit at the NYSE price.
Lofty: 63 of 81 property tokens last traded below their original listing price, and no independent valuation is published to separate discount from value change (review of October 5, 2026).
Masterworks: PPEX secondary trading of Masterworks shares ended on October 19, 2026, replaced by a bulletin board that does not match buy and sell orders, which removes a price reference for holders.
Backed: the holder owns a debt claim backed by shares; the token's secondary price is only as good as the venue quoting it, and trading is permissionless while issuance and redemption are not.
Checklist before buying from a venue rather than the fund
Latest NAV, its valuation time, and accrued income since then.
Your eligibility to subscribe directly, and the price and timing you would get.
Your eligibility to redeem, with cutoffs, caps, fees and settlement currency.
Depth and spread on the venue, and recent trade sizes rather than the last print.
Whether the token on the venue is the fund's native token or a wrapped or bridged copy the fund may not redeem.
How investors apply the term
Investors usually apply this term by tying the definition back to the controlling documents and then asking which cash flows, rights, restrictions, or valuation assumptions it changes. A useful review looks at the term alongside fees, leverage, liquidity, reporting frequency, and manager discretion rather than treating it as a standalone concept.
The practical diligence test is simple: identify who benefits if the assumption is wrong, who has control when conditions change, and what evidence the investor receives after closing. Terms that cannot be reconciled to documents, cash movements, and monitoring data should be treated as marketing shorthand until proven otherwise.
Frequently asked questions
- Why does a token trade above or below its NAV?
- Because the people trading it cannot always close the gap through the fund. If buyers on a venue cannot subscribe at NAV, or sellers cannot redeem at NAV quickly, the market price reflects supply and demand on that venue, the time until the next NAV, redemption fees and caps, and the risk that redemption is delayed. Thin trading and wide bid-ask spreads widen the gap further.
- How do I calculate a premium or discount?
- Premium or discount = (market price minus NAV) / NAV. A token at $10.08 with a NAV of $10.00 trades at a 0.80% premium; at $9.92 it trades at a 0.80% discount. Use a NAV and a price from the same moment, or adjust the NAV for income accrued since the last valuation.
- Can I buy at a discount and redeem at NAV for a profit?
- Only if you are eligible to redeem, the fund accepts redemptions when you ask, and the gap exceeds redemption fees, conversion costs and the income you forgo while waiting. Many tokenized funds limit redemption to onboarded holders on an allowlist, and some cap or suspend it, which is exactly why discounts persist.
- Do closed-end funds have the same issue?
- Yes. A listed closed-end fund has no daily redemption right, so its exchange price often sits at a premium or discount to NAV for long periods. Robinhood Ventures Fund I, for example, reported a NAV of $29.20 per share at September 30, 2026 in its October filing, while its NYSE price is set by trading.
- What if the platform publishes no NAV at all?
- Then there is nothing to compare the price with, and the original offering price is not a substitute. AltStreet's Lofty review found that 63 of 81 property tokens last traded below their original listing price; Lofty publishes no independent valuation that would show whether that reflects a discount or a change in value.