Answer: 28.87%
Explanation:
Given the following ;
Portfolio worth = $200,000,000
Liabilities = $6,000,000
Outstanding shares = $10,000,000
Share value = $25 per share
NAV, The Net Asset Value of the Stone Harbor Fund is the difference between total worth of it's asset and it's Liabilities.
Net Asset Value = (portfolio worth - Liabilities) ÷ outstanding shares
NAV = $(200,000,000 - 6,000,000) ÷ $10,000,000
NAV =$194, 000,000 ÷ $10,000,000
NAV = $19.4
Premium = $25 - $19.4 = $5.6
Expressed as a percentage of Net Asset Value:
$(5.76 ÷ 19.4) × 100 = 0.2886 × 100 = 28.87%
