> For the complete documentation index, see [llms.txt](https://docs.ontorium.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.ontorium.io/ontorium-stack-overview/financial-layer/aqua-vaults/nav-and-share-price.md).

# NAV & Share Price

This page explains how the value of an AQUA Vault share is determined.

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### NAV Definition

Net Asset Value (NAV) represents the total value attributable to the vault, denominated in the vault's underlying deposit asset.

Vault NAV may include:

* Undeployed assets held directly by the vault
* The value of positions allocated to on-chain strategies
* The latest recognized value of approved off-chain strategies
* Accrued or reported strategy yield
* Pending receivables or settlement amounts, where applicable<br>

Assets already committed to queued or claimable withdrawals are excluded from the active vault value attributable to remaining shareholders.\
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Management and performance fees are generally reflected through the issuance of fee shares, which affects the value of existing vault shares rather than directly reducing totalAssets.

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### Share Price Formula

```
Share Price = totalAssets / totalSupply
```

* **totalAssets**: the vault's recognized NAV
* **totalSupply**: the total number of vault shares outstanding<br>

Actual share conversion calculations may also include virtual share adjustments, rounding rules, and applicable fees.

Deposits and withdrawals use the vault's current accounting exchange rate. The final number of shares minted or burned, and the assets received by the user, may differ depending on configured deposit or withdrawal fees.\
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As strategies generate positive returns, totalAssets may increase relative to totalSupply, causing the value of each vault share to rise. Strategy losses or negative valuation changes may cause the share price to decline.\
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For queued withdrawals, vault shares are burned when the withdrawal request is submitted, not when the assets are later claimed. The withdrawal amount and applicable withdrawal fee are determined at the request stage.

***

### Strategy Valuation

On-chain strategies are valued using strategy-specific accounting derived from on-chain state. For example, the vault may read the value of a supplied position in a lending market, including interest recognized by the underlying protocol.\\

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Off-chain strategies are valued through periodic NAV reporting. An authorized reporter submits the strategy's updated valuation through the reporting framework described in [Transparency & Reporting.](broken://pages/v7J9iY1JA9Wl2QYuOpaO)

The latest valid report is incorporated into vault accounting. Where configured, positive NAV changes may be recognized gradually under the vault's maximum rate mechanism rather than being reflected immediately in full.

***

### NAV Updates and Stale Risk

Off-chain NAV reports are submitted according to a defined reporting schedule. Each report is subject to a validity window.\\

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If a new valid report is not submitted within that window, the off-chain valuation is considered stale.
\
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While an off-chain valuation is stale:

* New deposits and share minting may be temporarily restricted
* Existing withdrawals are not automatically blocked solely because of the stale report
* Withdrawal settlement remains subject to available vault liquidity
* A withdrawal may enter the queue if immediate liquidity is insufficient\
  \\

Deposit and mint operations resume when a valid report is submitted.\\

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This mechanism helps prevent users from entering the vault using outdated valuation information at the expense of existing depositors.

***

### APY and Share Price

Vault APY may be calculated from changes in share price over a defined historical period. Because vault-level management and performance fees are reflected in share accounting, the resulting APY represents strategy performance after applicable vault-level fees.\\

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Incentive or Boost APY distributed through separate reward programs is not included in the vault share price unless explicitly stated.\\

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Because share price reflects actual recognized performance, short-term APY may fluctuate and differ from longer-term averages. APY is annualized and backward-looking. It should not be interpreted as a forecast or guaranteed return.