NAV Based Expense Rule Calculation Example

You can use an adjusted NAV expense rule to set up a NAV based expense rule. In this example, you set up an adjusted NAV expense rule to exclude all short positions of a security for the income statement ledger account range (3001000000 through 5999999999).

The variable expense uses a tier rule shown in the following table.

You set up the variable expense to have a NAV component of prior night assets and you include the adjusted NAV expense rule on the variable expense setup.

The prior night net assets for the fund are 5,273,000.00. The total amount of the adjusted NAV expense rule is -34,500.00. Summing up the Prior Night Assets plus the adjusted NAV Expense rule amount gives a total adjusted NAV amount of 5,307,500.00 (5,273,000.00 + -34,500.00).

Using this tier rule, the system calculates the variable expense as shown in the following table.