The cost basis of a stock at its original value helps the owner calculate the profit or loss on that original purchase. Over time, an asset changes value due to a number of factors: recent stock ...

For example, if the firm purchases 10 percent of a company with a market capitalization of $500,000, then the value of the transaction is 0.10 x $500,000 = $50,000.

To calculate yield, subtract the bill's purchase price from its face value and then divide the result by the bill's purchase price. Finally, multiply your answer by 100 to convert it to a percentage.

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money for the best return.

Even still, calculating the net asset value for a hedge fund should be relatively easy to do if you have access to the hedge fund 's financials.

To calculate residual value, start with the asset's original purchase price. This is the amount paid when the asset was new, such as the cost of a car, machine, or piece of equipment.

Net worth is the value of your assets, which is basically everything you own, such as your retirement savings and real estate, minus your liabilities — the total of everything you owe.

To show you how to calculate the net asset value of a hedge fund, we'll look at the financial statements of Pershing Square Holdings , a publicly traded "hedge fund" that's managed by Bill Ackman ...

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money.