Financial Industry Regulatory Authority (FINRA) Practice Exam 2025 - Free FINRA Practice Questions and Study Guide

The redemption value of an open-end investment company's shares is determined based on the net asset value (NAV) computed after the order is received. This means that when a shareholder submits a redemption request, the value of their shares is assessed at the current NAV at that specific point in time, rather than any previous value or offering price.

The NAV is calculated by taking the total assets of the fund, subtracting any liabilities, and then dividing by the number of shares outstanding. This method ensures that investors are buying or selling shares based on the most current information about the fund's value, reflecting any changes in the underlying securities during the trading day. It’s important to note that the pricing of redeemable shares must be fair and accurately reflects the current value of the fund’s investments, which adheres to regulatory requirements intended to protect investors' interests.