AIF Distributions vs NAV Growth: How Returns Show Up in Real Life

In AIFs, returns can appear in two ways: NAV appreciation and distributions. Investors often track only one and misunderstand the full picture.

Some strategies distribute cash as exits happen or coupons are received. Others retain value inside the fund until maturity. Both can be valid depending on the strategy, but the investor must know what to expect so cash flows do not surprise the household plan.

Ask two questions before committing: how do returns typically show up in this fund, and what is the expected distribution pattern across the fund life? When cash flow expectations are clear, the holding experience becomes calmer.

Truvest Insight: Know whether your return is cash, NAV, or both.

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