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Value Investing
Net Current Asset Value (NCAV)
Net Current Asset Value (NCAV) is the cornerstone of Benjamin Graham's deep value strategy. It gives you the theoretical minimum a company is worth if it were liquidated today.
The Formula
NCAV = Current Assets − Total Liabilities
Net-net stocks trade below their NCAV per share — you buy the company for less than its liquidation value, getting the business for free.
🧮 NCAV Calculator
Graham's Buying Rule
Graham recommended buying stocks at no more than two-thirds of NCAV per share. The extra margin of safety protects against errors in the balance sheet data and the time value of money while waiting for the discount to close.
- NCAV ratio < 0.67 — Strong Graham buy signal
- NCAV ratio 0.67–1.0 — Qualifies as net-net, moderate signal
- NCAV ratio > 1.0 — Not a net-net, price exceeds liquidation value
⚠ Important: NCAV is a starting point, not the whole picture. Always check the quality of current assets (are receivables collectible? is inventory sellable?), the burn rate, and insider ownership before investing.