INAV & ETF Tickers

Every exchange traded fund has a second ticker that shows price movements on the underlying basket of holdings, allowing individuals to execute trades on a better informed investment decision.

Looking up the intraday net asset value, or INAV, by sticking the “.IV” at the end of an ETF’s ticker, investors can see price movements on the underlying index calculated at 15-second intervals throughout the day, writes Ari I. Weinberg for the Wall Street Journal. It is also referred to as the intraday indicative value (IIV) or the indicative optimized portfolio value (IOPV).

The .IV feature can be found on a couple of sites, including Yahoo! Finance and Thomson Reuters.

Morningstar ETF analyst Samuel Lee points out that the second ticker can be useful to provide information on the reasonableness of an ETF’s market price. If ETF’s price diverges from its INAV, it is probably better to hold off on the trade. However, the INAV is not that helpful in certain market conditions and for some types of securities.

For instance, investors may notice a wide INAV on fast-moving fixed-income ETFs. They represent price approximations on bond trades that haven’t gone through yet. The INAV is calculated on assumptions about how much yields on bonds will exceed that of Treasuries. [Bond ETFs and Illiquid Markets]

“In a fast-moving market, it’s possible for the trading of the fund to lead the INAV,” Phil Bak, managing director for exchange-traded products at NYSE Euronext, said in the article.

For internationally focused equity ETFs, the timezone difference between normal trading hours varies. Consequently, the INAV may be stale. Asia or Australia related ETFs show an INAV based on closing prices where trading occurred during overnight hours in the U.S. Moreover, foreign countries observe different holidays. [Understanding ETF Liquidity]