Sample Computation of Profit Gain from Mutual Fund Investments

by Gily Tenorio on January 29, 2012

in Mutual Funds


In my previous posts about mutual funds, I discussed why it is the best alternative to time deposits and how could you invest in it. As a new investor on mutual funds, there are many questions you might need to know but there are few facts that you can get from website of companies offering these kind of investments.

Some readers of this blog are commenting and asking me to give them a sample computation on how to calculate the profits gained from investing in MF. In this regard, I would like to show you a sample calculation in this post.

Before studying the calculation below, you should first learn some basic terms in mutual funds. You should know what is NAVPS, sales load, redemption fee, and other important words related to investing. Take note that this computation is applicable only for mutual funds with zero redemption fee.

Most of the investment companies have zero redemption fee after six months of mutual fund investment has elapsed. When you redeem your funds earlier than 6 months, there is a corresponding redemption fee that you need to pay which will be deducted from your fund receivables.

How to Compute Profit Gain from Mutual Fund Investments

In order to start with the computation, we should have some data that we can use. Take note that these data are just assumption and some will be coming from the latest information posted in First Metro Asset Management, Inc. (FAMI) website. For example, you invested P20,000 in FAMI equity fund in May 2011 with the following information about your investment:

Amount of Money Used for Investment (A): P20,000
NAVPS when MF was Bought (B): P3.2489 per share
Sales load (S): 2% of (A) = 0.02*20,000 = 400 = P400
Total Amount of Money to buy MF (T): 20,000-400 = P19,600

Number of Shares that You can Bought: T/B = 19,600/3.2489 = 6,032 shares

From the data above, you can see that the total number of shares you bought from the P20,000 investment is 6,032 shares of equity MF. To compute your profit gain, you should know the latest NAVPS of the fund. In case of FAMI equity fund, the NAVPS on January 27, 2012 is 3.9279.

Profit Gain = 6,032*(3.9279-3.2489) = 6,032*0.679 = P4,095.73

Profit Gain = 4,095.73

If you add this number (4,095.73) to the amount of money (19,600) that you use to buy the mutual fund, you will get 23,695.73. This should be the same with the computation below.

Net Amount of Money in MF = 6,032 (number of shares)*3.9279 (price per share) = P23,693.08

The difference between the two numbers is due to rounding up of numbers but basically they should be the same.Your total profit gain in investing in equity FAMI mutual fund is 4,095.73 based on the computation above. In addition, the net amount of your money in MF is P23,693.08.


The calculation above is for information purposes only. It is not meant to give you investing advice but encourages you to invest in mutual fund at your own risk. Your own decision should prevail if you want to invest in mutual funds. The return or profit is not guaranteed by the investment company. In addition, I have no working relationship with FAMI nor compensated to use their company in this post.

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{ 10 comments… read them below or add one }

Raider June 7, 2013 at 04:09

Some queries regarding navps computation..
1. Additional investment current navps must be computed every purchase? Or only from initial navps - current navps = profit


Gily Tenorio June 24, 2013 at 13:13

Hi Raider,

Every time you purchase MF, there’s a corresponding NAVPS for that batch of MF. So you must use the NAVPS when you bought the MF and the current NAVPS to get the profit.


Baby October 24, 2012 at 04:55


I would like to know where we can invest in MF


Gil October 26, 2012 at 11:56

Hi Baby,
Normally, you can invest mutual funds in an investment company like FAMI AND PAMI. You could also invest in BPI, they have many kinds of mutual funds.


Vepz17 March 15, 2012 at 13:59


I would like to know if the sales load is also applied in the additional investments? Just in case when putting 1k in a monthly basis.. So everytime you invest, there’s always 2% load.Thanks! ^.^


learnfe March 16, 2012 at 13:49

Hi, yes you are right, every time you invests in MF, a sales load will be deducted.


Rhianna March 4, 2012 at 08:20

hi! sa 6,032shares previously deducted na po yung sales load. My question is dalawang beses po ba talaga iddeduct yung sales load? kasi umulit po sa PG yung pagdeduction ng sales load.


learnfe March 4, 2012 at 12:56


Sales load will be deducted only once before buying the MF. I think I need to edit the article to make it clearer. Thanks for the comment.


Paul March 1, 2012 at 03:39

Hi .., First of all., i would like to thank you .,, i have learned a lot from this blog. And i am excited to invest in mutual funds. I have one question with regard to NAVPS.. Gaano po kadalas mag bago ito? Kelan cia mag Drop and kelan po ba dapat tayo bibili ng share (well of course when the price is low) i would like to get some tips from you. God bless

-Paul =^_^=


learnfe March 1, 2012 at 06:15

Hi Paul,

You’re welcome. NAVPS changes from Mon - Fri except holidays. The best way to buy MF is through cost averaging. Meaning, you will regularly buy every month or your preferred duration (if it is possible).


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