Why do my pool units get to be incorrect?
- 05 May 2023
- Contributors
- Print
- DarkLight
- PDF
Why do my pool units get to be incorrect?
- Updated on 05 May 2023
- Contributors
- Print
- DarkLight
- PDF
Article summary
Did you find this summary helpful?
Thank you for your feedback
I am seeing that units in my investment pool for some funds that seem to be incorrect, what causes that?
Answer:
Units:
The number of units a fund has is based on the dollar value they have in the pool. If a fund adds $1,000 to their pool balance, and unit values are $100, the fund will get 10 more units. Every unit any fund owns in the pool has the same value, but funds own different numbers of units. The number of units a fund owns can only change through deposits or withdrawals from the pool for that fund. The unit value only increases through gains or losses (real or unrealized gains/losses, interest & dividends). Thus comparing the unit value from start to present can be used as a guide to see the increase (or decrease) of value in the whole pool through gains.
Unitization Report:
The ending unit value at the top times the ending unit for each fund should equal the ending market value. If not, it means the unit value for the funds is off.
The number of units a fund has is based on the dollar value they have in the pool. If a fund adds $1,000 to their pool balance, and unit values are $100, the fund will get 10 more units. Every unit any fund owns in the pool has the same value, but funds own different numbers of units. The number of units a fund owns can only change through deposits or withdrawals from the pool for that fund. The unit value only increases through gains or losses (real or unrealized gains/losses, interest & dividends). Thus comparing the unit value from start to present can be used as a guide to see the increase (or decrease) of value in the whole pool through gains.
Unitization Report:
The ending unit value at the top times the ending unit for each fund should equal the ending market value. If not, it means the unit value for the funds is off.
Was this article helpful?
