Net Current Asset Value Per Share - NCAVPS

A value created by professor Benjamin Graham in the mid-twentieth century to determine if a company was trading at a fair market price. NCAVPS is calculated by taking a company's current assets and subtracting the total liabilities, and then dividing the result by the total number of shares outstanding.

NCAVPS: (Current Assets- Total Liabilities)
# Shares Outstanding

According to Graham, investors will benefit greatly if they invest in companies where the stock prices are no more than 67% of their NCAV per share. A study done by the State University of New York to prove the effectiveness of this strategy showed that from the period of 1970 to 1983 an investor could have earned an average return of 29.4%, by purchasing stocks that fulfilled Graham's requirement and holding them for one year.

However, Graham did make it clear that not all stocks chosen in this manner will have excessive returns, and that investors should also diversify their holdings when using this strategy.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Asset Value Per Share — The total value of a fund s investments divided by its number of shares outstanding. This type of asset value per share is more commonly referred to as net asset value per share or simply net asset value or NAV. Asset value per share can also… …   Investment dictionary

  • Net asset value — (NAV) is a term used to describe the value of an entity s assets less the value of its liabilities. The term is most commonly used in relation to open ended or mutual funds because shares of such funds registered with the U.S. Securities and… …   Wikipedia

  • value — The importance placed on something by an individual. Value is subjective and may change according to the circumstances. Something that may be valued highly at one time may be valued less at another time. The CENTER ONLINE Futures Glossary * * * ▪ …   Financial and business terms

  • value — The utility of an object in satisfying, directly or indirectly, the needs or desires of human beings, called by economists value in use, or its worth consisting in the power of purchasing other objects, called value in exchange. Joint Highway… …   Black's law dictionary

  • Book value — In accounting, book value or carrying value is the value of an asset or according to its balance sheet account balance. For assets, the value is based on the original cost of the asset less any depreciation, amortization or impairment costs made… …   Wikipedia

  • book value — 1) See: net book value 2) (net asset value) The value of a company calculated as that of its total assets less intangible assets and liabilities. The information required to calculate the book value is all in the balance sheet. However, it can be …   Accounting dictionary

  • book value — 1) See net book value 2) = net asset value The value of a company calculated as that of its total assets less intangible assets and liability The information required to calculate the book value is all in the balance sheet However, it can be very …   Big dictionary of business and management

  • National Asset Management Agency — Agency overview Formed Late 2009 Jurisdiction Ireland …   Wikipedia

  • book value — n: the value of something as shown on bookkeeping records as distinguished from market value: as a: the value of an asset equal to cost less depreciation b: the value of a corporation s capital stock expressed as its original cost less… …   Law dictionary

  • Surplus value — is a concept created by Karl Marx in his critique of political economy, where its ultimate source is unpaid surplus labor performed by the worker for the capitalist, serving as a basis for capital accumulation.The German equivalent word Mehrwert… …   Wikipedia

  • Time value of money — The time value of money is the value of money figuring in a given amount of interest earned over a given amount of time. The time value of money is the central concept in finance theory. For example, $100 of today s money invested for one year… …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.