{"url":"https://etfiq.com/academy/trading-basics/premium-and-discount/","section":"academy","title":"Premium and discount: when price and value split | ETFIQ","description":"Learn what an ETF premium or discount to NAV is, how to turn it into dollars and why some funds drift, using a year of real daily data.","as_of":"Nov 10, 2026","structured_data":[{"@type":"LearningResource","@id":"https://etfiq.com/academy/trading-basics/premium-and-discount/#lesson","name":"Premium and discount: when price and value split","description":"Over 250 trading days to Nov 10, 2026, TINY closed more than 1% from its NAV on 63 days, while NOBL did so on none.","url":"https://etfiq.com/academy/trading-basics/premium-and-discount/","learningResourceType":"Lesson","teaches":"What an ETF premium or discount to NAV is, how to turn it into dollars, and why some funds drift from their holdings","educationalLevel":"Beginner","timeRequired":"PT6M","inLanguage":"en","isAccessibleForFree":true,"isPartOf":{"@type":"Course","@id":"https://etfiq.com/academy/trading-basics/#course","name":"Trading Basics","url":"https://etfiq.com/academy/trading-basics/"},"position":4,"dateModified":"2026-11-10","author":{"@type":"Organization","name":"ETFIQ Research","url":"https://etfiq.com"},"publisher":{"@type":"Organization","name":"ETFIQ Research","url":"https://etfiq.com"}},{"@type":"FAQPage","@id":"https://etfiq.com/academy/trading-basics/premium-and-discount/#check","mainEntity":[{"@type":"Question","name":"A fund's NAV is $40.00 and its price is $39.80. What is it trading at?","acceptedAnswer":{"@type":"Answer","text":"A 0.5% discount. ($39.80 \u2212 $40.00) \u00f7 $40.00 = \u22120.005, a 0.5% discount, since the price is below the NAV."}},{"@type":"Question","name":"You buy $10,000 of a fund at a 1% premium. A week later the NAV is unchanged and the fund trades exactly at NAV. About what is your stake worth?","acceptedAnswer":{"@type":"Answer","text":"$9,900. at a 1% premium your $10,000 bought about $9,900 of holdings ($10,000 \u00f7 1.01), and that is what you can sell for at NAV."}},{"@type":"Question","name":"TINY had no active APs in its latest filing year. Why does that help explain its large gaps?","acceptedAnswer":{"@type":"Answer","text":"Nobody is creating or redeeming shares, so nothing pulls the price back to the NAV. APs close gaps by creating shares when the price is high and redeeming when it is low; without them the gap can last."}}]},{"@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"ETFIQ","item":"https://etfiq.com/"},{"@type":"ListItem","position":2,"name":"Academy","item":"https://etfiq.com/academy/"},{"@type":"ListItem","position":3,"name":"Trading Basics","item":"https://etfiq.com/academy/trading-basics/"},{"@type":"ListItem","position":4,"name":"Premium and discount","item":"https://etfiq.com/academy/trading-basics/premium-and-discount/"}]},{"@type":"WebPage","name":"Premium and discount: when price and value split","description":"Learn what an ETF premium or discount to NAV is, how to turn it into dollars and why some funds drift, using a year of real daily data.","url":"https://etfiq.com/academy/trading-basics/premium-and-discount/","dateModified":"2026-11-10","isPartOf":{"@type":"WebSite","name":"ETFIQ","url":"https://etfiq.com"},"speakable":{"@type":"SpeakableSpecification","cssSelector":[".lede"]},"publisher":{"@id":"https://etfiq.com/#org"}}],"characters":5840,"truncated":false,"content":"ETFIQ / Academy / Trading Basics / Premium and discount \n \n Premium and discount: when price and value split\n Data as of Nov 10, 2026. Rebuilt every trading night.\n Over 250 trading days to Nov 10, 2026 , TINY closed more than 1% from its NAV on 63 days, while NOBL did so on none .\n Trading Basics \u00b7 Lesson 4 of 7 1 2 3 4 5 6 7 \n Tap one of TINY's real gaps, or slide your own, to see what a gap costs. TINY usual range (\u00b12.49%) TINY widest day (4.15% discount) NOBL usual range (\u00b10.06%) Amount you buy (hypothetical) $10,000 Price against NAV (hypothetical) +2.49% You pay $10,000 for $9,757 of holdings: a $243 premium. Hypothetical amounts. Marks over the 250 days to Nov 10, 2026. Step 1: a normal day. On 95% of days, NOBL closed within 0.06% of its NAV, and TINY within 2.49% . On a $10,000 purchase: NOBL: $10,000 \u00d7 0.0006 = $6 TINY: $10,000 \u00d7 0.0249 = $249 Step 2: how often was the gap big? TINY closed more than 1% from its NAV on 63 of 250 days : 63 \u00f7 250 \u2248 25% , about one day in 4 . NOBL: 0 days . Step 3: the worst day. TINY's widest gap was a 4.15% discount on Mar 9, 2026 . Selling shares whose holdings were worth $10,000 brought in $10,000 \u00d7 (1 \u2212 0.0415 ) = $9,585 . NOBL's worst was a 0.25% discount on Jun 26, 2026 : $9,975 . Step 4: why TINY drifts. In its latest annual filing year, to May 31, 2026 , 0 of TINY's 39 APs created or redeemed a single share. With nobody creating or redeeming, nothing pulls the price back to the NAV. Step 5: buy high, sell low (hypothetical). Say you buy TINY at a 2.49% premium and sell at a 2.49% discount, the two edges of its usual range, while the holdings' value stays put. At a 2.49% premium, $10,000 buys holdings worth only $10,000 \u00f7 1.0249 \u2248 $9,757 . Sell them at a discount: $9,757 \u00d7 (1 \u2212 0.0249 ) \u2248 $9,514 . You lose about $486 with no change in what the fund owns. \n The question\n How far can an ETF's price stray from what it holds, and does that cost me?\n The idea\n Lesson 1 showed that an ETF has a market price and a NAV (the basket's worth divided by the number of shares). When the price is above the NAV, the fund trades at a premium : you pay more than the holdings are worth. When it is below, it trades at a discount : a seller gets less than they are worth.\n Premium or discount = (price \u2212 NAV) \u00f7 NAV.\n US rules (SEC Rule 6c-11) require every ETF to publish this gap on its website daily. In most large funds it stays tiny, because authorized participants (APs, lesson 1 ) create shares when the price is high and redeem them when it is low. When they are slow or missing, the gap can grow.\n Worked example\n The 5 steps beside the drawing at the top work this through on ETFIQ data. Point at a step to light the part of the drawing it describes.\n Two ProShares ETFs from lessons 2 and 3 , NOBL and TINY, over the 250 trading days to Nov 10, 2026 .\n The common mistake\n \"A discount means a bargain.\" You pay less than the holdings are worth today, but you may sell at a discount too. In a fund with no active APs, nothing makes the gap close. A discount is a sign to look closer, not a free gain.\n Check your understanding\n Pick an answer to see why. Two of three right passes the lesson.\n 1. A fund's NAV is $40.00 and its price is $39.80. What is it trading at? A A 0.5% premium B A 0.5% discount C A 0.2% discount D A 20% discount Answer: B. A 0.5% discount. ($39.80 \u2212 $40.00) \u00f7 $40.00 = \u22120.005, a 0.5% discount, since the price is below the NAV. Not C: 0.20 is the gap in dollars, not the percentage. 2. You buy $10,000 of a fund at a 1% premium. A week later the NAV is unchanged and the fund trades exactly at NAV. About what is your stake worth? A $10,000 B $10,100 C $9,900 D $9,000 Answer: C. $9,900. at a 1% premium your $10,000 bought about $9,900 of holdings ($10,000 \u00f7 1.01), and that is what you can sell for at NAV. Not A: the price fell back to the NAV, so the extra 1% you paid is gone. 3. TINY had no active APs in its latest filing year. Why does that help explain its large gaps? A Nobody is creating or redeeming shares, so nothing pulls the price back to the NAV B The fund sets its own price each morning C APs cause premiums, so fewer APs means more of them D Its NAV is only worked out once a year Answer: A. Nobody is creating or redeeming shares, so nothing pulls the price back to the NAV. APs close gaps by creating shares when the price is high and redeeming when it is low; without them the gap can last. Not C: APs shrink gaps, they do not cause them. \n Takeaways\n Premium or discount = (price \u2212 NAV) \u00f7 NAV; multiply by your amount to see it in dollars. \n Check a fund's record, not just today: how wide its usual range is, and how many days it strayed past 1%. \n A gap paid on the way in can be lost on the way out, even when the holdings never move. \n Do it on ETFIQ\n See your fund's premium history Your fund \n Where to next\n Next lesson: Liquidity: why trading volume is the wrong clue Previous lesson: The bid-ask spread: the trading cost you don't see Trading Basics: all lessons The explainer behind this lesson ETFIQ Academy How ETFIQ computes these numbers \n Cite this page. ETFIQ, Premium and discount: when price and value split, data as of Nov 10, 2026. https://etfiq.com/academy/trading-basics/premium-and-discount/ Free to use with attribution for data ETFIQ computes; issuer data stays under its owner's terms. The underlying files are at Open data .\n Other forms Plain ETFIQ, Premium and discount: when price and value split, data as of Nov 10, 2026. https://etfiq.com/academy/trading-basics/premium-and-discount/ APA ETFIQ. (Nov 10, 2026). Premium and discount: when price and value split. Retrieved from https://etfiq.com/academy/trading-basics/premium-and-discount/ Markdown [Premium and discount: when price and value split (ETFIQ, Nov 10, 2026)](https://etfiq.com/academy/trading-basics/premium-and-discount/)","source":"ETFIQ, independent ETF data. Recomputed nightly from public filings and prices.","publisher":{"@id":"https://etfiq.com/#org","name":"ETFIQ","url":"https://etfiq.com"},"license":"https://etfiq.com/license/","license_text":"Data ETFIQ computes is free to use with attribution: ETFIQ (etfiq.com). Issuer data stays under its owner's terms.","citation":"ETFIQ, Premium and discount: when price and value split, data as of Nov 10, 2026. https://etfiq.com/academy/trading-basics/premium-and-discount/"}