What Is the Difference Between a Unit Price & Stock Price?

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A unit price is a currency value assigned to a single unit of measure. For example, a unit price can be applied to a mutual fund's basket of securities. A mutual fund's unit price is the price per fund share; each share represents a unit of ownership in the fund's basket of different types of securities. Instead of tracking the price of each individual security in the basket, you will track the overall price of those securities when combined.

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A stock or share price represents a public company's market valuation per share; each share represents a unit of company ownership. A fund's unit price is determined through its net asset value, or the fund's assets subtracted by its liabilities, while a company's stock price is based on business and market conditions. Stock prices can even be up even though the company as a whole's valuation is down.

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Definition of a Unit Price

According to Investopedia, a mutual fund's NAV is the market value of the fund. When a trading day comes to a close, the NAV is calculated based on the fund's portfolio of security holdings. NAV per share involves taking the fund's assets, subtracting the fund's liabilities and dividing by the number of fund shares outstanding. This value determines the fund's bid price, or the price used to purchase fund shares, and the redemption price, the selling price of the fund's shares back to the fund. Stock market websites and financial news websites can help you to track these numbers over time.

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Example of a Unit Price

Assume the Mucho Moola mutual fund has $100 million in assets, $45 million in liabilities and 13 million shares outstanding by the end of a trading day. The fund's NAV equals its $100 million in assets, subtracted by $45 million in liabilities, or $55 million. The NAV per fund share equals the NAV divided by the fund's 13 million shares outstanding, or around $4.23 per fund share. The $4.23 price per fund share will determine the next trading day's bid and redemption prices. These numbers change over time, and if you follow them over time you will gain a good idea of when prices are higher or lower than usual.

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Definition of a Stock Price

The Corporate Finance Institute reports that a stock price represents the market valuation per share of a company. Different variables affect a company's stock price – the company's financial condition and earnings, future growth expectations, industry trends and current economic conditions. A stock price fluctuates constantly due to market conditions. You might even notice fluctuations in prices by examining stocks by industry. For instance, tech stocks might all be up or down at the same time.

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Example of a Stock Price

Stock prices are available for all publicly traded companies and published by major business news sources. It is possible to estimate the value per share of a company and compare it to the actual stock price. This comparison can give you an idea whether a stock price is overvalued or undervalued. Stock price valuation calculators are available online and utilize several variables to estimate the company's value per share.

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