Hello,
I have one rather elementary question. I was going through the reports of one Hedge Fund (i.e. Vltava Fund SICAV wwwDotvltavafundDotcom/assets/dopis_2013_en.pdf) that presents its performance in NAV (Net Asset Value). How do withdrawals or deposits impact NAV? For example: when NAV grows by 20% p.a. (thanks to clients’ deposits) is the profit applied to clients the same (=20%) or can it be different?
To be more specific on my thoughts: Let’s say NAV = £10.000, the new client comes in and deposits another £2.000. From my very laic understanding NAV should increase by 20% although Hedge Fund did not realize any profit. So profit for clients would equal to 0.
So in this case although Hedge fund reports 20% increase in the NAV it was not generated by the profit but rather from additional deposit coming in.
Could anyone pls explain me what is the real performance of the fund? Many thanks Petr
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