Investors in Listed Investment Companies often talk about shares trading at a 'discount' or 'premium' to NTA, below is an explanation of what this means.
Share Price is the current price of an AFIC share on the ASX. Net Tangible Assets per share (NTA) is the value of the total portfolio divided by the number of shares on issue.
Using a simple example, if the value of the total portfolio is $100 and the number of shares on issue is 10, then the NTA is $10 per share.
|NTA per share||Share price||Trading|
|$10||$11||At a premium|
|$10||$9||At a discount|
The chart below outlines where the AFIC share price has been trading relative to the NTA at the end of each month.