Client Focus - Fair Value Information Services
Mutual Funds can utilize Interactive Data’s Fair Value Information Service to assist in determining the “fair value” of international securities at the time of net asset value (NAV) calculation. The Fair Value Information Service is designed to estimate the price at which an international equity security would trade in a liquid market at the time of NAV calculation.
Mutual funds also utilize Interactive Data’s online Web tools to examine the historical and daily performance of the model through a series of tests. For instance, one test examines how often the Fair Value Information Service valuation is closer to the next day’s open price than the local closing price over a certain period of time (e.g., on a quarterly basis). This analysis allows clients to actively monitor the how the model is performing with respect to their securities of interest.
Interactive Data proactively researches fair valuation topics which may be of interest to the financial community. These studies, including Interactive Data’s series of White Papers, examine subjects ranging from arbitrage and market timing to trigger levels in mutual funds.
This ground-breaking service provides tools designed to assist the mutual fund industry in addressing its legal obligation to fair value certain equities where market quotations are not readily available, as well as in deterring market timers while protecting long-term investors.