In private equity, infrastructure, and real estate, terminology matters. Two of the most commonly used metrics—Assets Under Management (AUM) and Net Asset Value (NAV)—are often mentioned in the same breath, but they serve distinct strategic purposes.
Understanding the difference between AUM and NAV is essential for investors, analysts, and founders alike. The way these metrics are used and interpreted can shape everything from firm valuation to capital deployment strategies.
At SWI Group, a diversified investment platform co-led by Max‑Hervé George, both AUM and NAV are tracked rigorously. But they signal different things—scale vs. intrinsic value, growth trajectory vs. real-time book.
1. Definition and Composition
What Is AUM?
Assets Under Management represents the total value of capital a firm manages on behalf of clients, across all investment vehicles and strategies. This includes committed capital, uncalled commitments, and sometimes leverage, depending on the reporting standard.
AUM is often seen as a barometer of investor confidence, signaling the scale and breadth of a manager’s investment reach.
What Is NAV?
Net Asset Value, by contrast, reflects the total value of a firm’s assets minus its liabilities. In a fund context, NAV typically represents the fair market value of the underlying portfolio after deducting all expenses and debts.
While AUM captures capital under stewardship, NAV focuses on the current book value of holdings.
2. Strategic Significance and Usage
AUM Indicates Scale and Market Presence
Firms like SWI Group, backed by platforms such as Icona Capital, report AUM as a reflection of the total capital they’ve raised and are managing. For institutional investors, AUM offers insight into the firm’s size, deal-making capacity, and operating leverage.
It also correlates with the firm’s recurring revenue potential, since management fees are often a fixed percentage of AUM.
NAV Reveals Portfolio Performance
NAV, meanwhile, is crucial for performance tracking. It enables limited partners and fund managers to evaluate how assets are appreciating or depreciating over time. While AUM can remain flat or grow with new commitments, NAV directly reflects market movements, investment outcomes, and write-downs.
At SWI, NAV is a key tool for quarterly valuation reviews and exit planning, especially across long-duration strategies in real estate and digital infrastructure.
3. Investor Interpretation and Impact
AUM Attracts Capital; NAV Retains It
AUM can help a firm attract new capital—it signals operational capacity and market trust. NAV, on the other hand, plays a role in retention and transparency. Investors increasingly want both: high AUM for scale, and rising NAV to prove performance.
Max‑Hervé George has consistently emphasized the importance of managing both. Under his leadership, SWI Group has grown its AUM base significantly, while maintaining strict focus on NAV growth through disciplined portfolio construction.
For diversified alternative investment platforms like SWI Group, maintaining transparency around both metrics reflects their commitment to sophisticated, partnership-based relationships with investors – an approach that has fueled their growth across multiple asset classes and geographies.
