If you notice a difference between the cash-out or switch amount shown on your Versa app and the final amount you receive (or the final value switched into your new fund), you are actually experiencing a standard and highly regulated financial process.
This is a common industry practice followed by mutual fund companies in Malaysia. It is driven by a mechanism called Forward Pricing, which is the standard expected by the Securities Commission Malaysia (SC) to ensure absolute fairness to all investors.
Here is everything you need to know about how your transaction is calculated:
- The app shows the “Latest Available” Net Asset Value
The Net Asset Value (NAV) displayed on your Versa app is the latest available NAV. Because mutual funds consist of many different assets (like stocks or bonds), it takes time to calculate their exact daily value after the global markets close. Therefore, the NAV you see on your app and on our partner AHAM Capital’s website is usually the finalized price from 1 to 2 business days ago.
When you request a cash-out or a fund switch, the amount shown on the screen is an approximation based on that past price, not the final price.
- What is “Forward Pricing”?
Unlike buying a cup of coffee where the price is fixed right now, mutual funds use Forward Pricing. This means transactions (both cashing out and switching) are processed using the exact NAV calculated at the end of the trading day, not the price from yesterday.
Here is how the timing works:
Before 3:00 PM: If you submit your cash-out or switch request before 3:00 PM on a business day, your transaction will be locked in and processed using the NAV calculated at the end of that same business day.
After 3:00 PM (or weekends/holidays): Because NAV is only calculated on working days, any request submitted after 3:00 PM will simply be processed using the NAV calculated at the end of the next business day.
- Why is this standard in place?
Under Paragraph 8.39 of the SC’s “Guidelines on Unit Trust Funds”, this practice is highlighted as the primary industry standard.
While the guidelines technically permit two pricing methods, the SC expects most mutual funds to use Forward Pricing (calculating the price at the end of the day) rather than historical pricing (using yesterday’s price).
The main reason is fairness. It prevents investors from taking unfair advantage of price delays. Because the final price isn’t locked in until the end of the trading day, no one can game the system by buying, selling, or switching based on old news. (Note: The SC only allows exceptions for a few specific, low-risk money market funds, which is why your Versa Cash-i works a bit differently!).
In summary: The difference you see is simply the market moving between the time the app’s “last available price” was updated and the actual market closing price on the day you cash out or switch. It could be slightly higher or lower, but it is always accurate and fully compliant with Malaysian financial industry standards!