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Financial Terms | |
Investment value |
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Definition of Investment valueInvestment valueRelated:straight value.
Related Terms:Net present value of future investmentsThe present value of the total sum of NPVs expected to result from Straight valueAlso called investment value, the value of a convertible security without the con-version option. Account ValueThe sum of all the interest options in your policy, including interest. Accumulated ValueAn amount of money invested plus the interest earned on that money. Adjusted present value (APV)The net present value analysis of an asset if financed solely by equity approximated net realizable value at split-off allocationa method of allocating joint cost to joint products using a Benefit ValueThe amount of cash payable on a benefit. ![]() Bond valueWith respect to convertible bonds, the value the security would have if it were not convertible Book valueA company's book value is its total assets minus intangible assets and liabilities, such as debt. A BOOK VALUEAn asset’s cost basis minus accumulated depreciation. Book ValueThe value of an asset as carried on the balance sheet of a Book valueAn asset’s original cost, less any depreciation that has been subsequently incurred. book valueNet worth of the firm’s assets or liabilities according book value and book value per shareGenerally speaking, these terms BOOK VALUE OF COMMON STOCKThe theoretical amount per share that each stockholder would receive if a company’s assets were sold on the balance sheet’s date. Book value equals: Book value per shareThe ratio of stockholder equity to the average number of common shares. Book value Book Value per ShareThe book value of a company divided by the number of shares Business Expansion InvestmentThe use of capital to create more money through the addition of fixed assets or through income producing vehicles. business-value-added activityan activity that is necessary for the operation of the business but for which a customer would not want to pay CAPITAL IN EXCESS OF PAR VALUEWhat a company collected when it sold stock for more than the par value per share. capital investment analysisRefers to various techniques and procedures Capital InvestmentsMoney used to purchase fixed assets for a business, such as land, buildings, or machinery. Also, money invested in a business on the understanding that it will be used to purchase permanent assets rather than to cover day-to-day operating expenses. Carrying valueBook value. Cash-surrender valueAn amount the insurance company will pay if the policyholder ends a whole life Cash Surrender ValueThis is the amount available to the owner of a life insurance policy upon voluntary termination of the policy before it becomes payable by the death of the life insured. This does not apply to term insurance but only to those policies which have reduced paid up values and cash surrender values. A cash surrender in lieu of death benefit usually has tax implications. Cash Surrender ValueBenefit that entitles a policy owner to an amount of money upon cancellation of a policy. Cash value added (CVA)A method of investment appraisal that calculates the ratio of the net present value of an Conversion valueAlso called parity value, the value of a convertible security if it is converted immediately. Dividend reinvestment plan (DRP)Automatic reinvestment of shareholder dividends in more shares of a Economic Value Added (EVA)Operating profit, adjusted to remove distortions caused by certain accounting rules, less a charge economic value added (EVA)a measure of the extent to which income exceeds the dollar cost of capital; calculated economic value added (EVA)Term used by the consulting firm Stern Stewart for profit remaining after deduction of the cost Equity investmentThrough equity investment, investors gain part ownership of the corporation. The primary type of equity investment is corporate stock. Exercise valueThe amount of advantage over a current market transaction provided by an in-the-money Exit valueThe value that an asset is expected to have at the time it is sold at a predetermined Expected return on investmentThe return one can expect to earn on an investment. See: capital asset Expected valueThe weighted average of a probability distribution. Expected ValueThe value of the possible outcomes of a variable weighted by the Expected value of perfect informationThe expected value if the future uncertain outcomes could be known Extraordinary positive valueA positive net present value. Face valueSee: Par value. Face ValueThe nominal value of a security. Also called the par value. Face valueThe maturity value of a security. Also known as par value, face valuePayment at the maturity of the bond. Also called par value or maturity value. Face ValueThe payoff value of a bond upon maturity. Also called par value. See principal. Face ValueThe nominal value which appears on the face of a document recording an entitlement, generally an amount of money that has to be repaid on the maturity of a debt instrument. Fair market valueThe price that an asset or service will fetch on the open market. Fair Market ValueThe highest price available, expressed in terms of cash, in an open and unrestricted market between informed, prudent parties acting at arm's length and under no compulsion to transact. Fair ValueThe amount at which an asset could be purchased or sold or a liability incurred or Firm's net value of debtTotal firm value minus total firm debt. Foreign direct investment (FDI)The acquisition abroad of physical assets such as plant and equipment, with Future investment opportunitiesThe options to identify additional, more valuable investment opportunities Future valueThe amount of cash at a specified date in the future that is equivalent in value to a specified Future ValueThe amount a given payment, or series of payments, will be worth future valuethe amount to which one or more sums of Future valueThe value that a sum of money (the present value) earning future valueAmount to which an investment will grow after earning interest. Future ValueThe amount to which a payment or series of payments will grow by a given future date when compounded by a given interest rate. FVIF future value interest factor. guaranteed investment certificate (GIC)A GIC is an investment that gives you a guaranteed rate of return over a fixed period of time, usually between 30 days and 5 years. GICs are available from banks, trust companies, and other financial institutions. Guaranteed investment contract (GIC)A pure investment product in which a life company agrees, for a Intrinsic value of a firmThe present value of a firm's expected future net cash flows discounted by the Intrinsic value of an optionThe amount by which an option is in-the-money. An option which is not in-themoney InvestmentThe commitment of funds (capital) in anticipation of an increased Investment analystsRelated: financial analysts Investment bankFinancial intermediaries who perform a variety of services, including aiding in the sale of Investment BankerMiddleman between a corporation issuing new securities and the public. The middleman buys the securities issue outright and then resells it to customers. Also called an underwriter. investment centera responsibility center in which the manager Investment centreA division or unit of an organization that is responsible for achieving an adequate return on investment decisiona judgment about which assets will be Investment decisionsDecisions concerning the asset side of a firm's balance sheet, such as the decision to investment gradeBonds rated Baa or above by Moody’s or BBB or above by Standard & Poor’s. Investment grade bondsA bond that is assigned a rating in the top four categories by commercial credit Investment incomeThe revenue from a portfolio of invested assets. Investment managerAlso called a portfolio manager and money manager, the individual who manages a Investment product line (IPML)The line of required returns for investment projects as a function of beta Investment SpendingExpenditures on capital goods including new housing. Financial ''investments" and sales of existing assets are not included. Investment tax creditProportion of new capital investment that can be used to reduce a company's tax bill Investment Tax CreditA reduction in taxes offered to firms to induce them to increase investment spending. Investment trustA closed-end fund regulated by the investment Company Act of 1940. These funds have a InvestmentsAs a discipline, the study of financial securities, such as stocks and bonds, from the investor's Legal investmentsinvestments that a regulated entity is permitted to make under the rules and regulations Liquidation valueNet amount that could be realized by selling the assets of a firm after paying the debt. Liquidation ValueThe net proceeds (after taxes and expenses) of selling the assets liquidation valueNet proceeds that would be realized by selling the firm’s assets and paying off its creditors. Loan valueThe amount a policyholder may borrow against a whole life insurance policy at the interest rate Market value1) The price at which a security is trading and could presumably be purchased or sold. Market valueThe price at which a product or service could be sold on the open market. Market ValueA quoted market price per unit times the number of units being valued. Synonymous market value addedMarket value of equity minus book value. market-value balance sheetFinancial statement that uses the market value of all assets and liabilities. Market value ratiosRatios that relate the market price of the firm's common stock to selected financial Market value-weighted indexAn index of a group of securities computed by calculating a weighted average Maturity valueRelated: par value. Mutually exclusive investment decisionsinvestment decisions in which the acceptance of a project Net adjusted present valueThe adjusted present value minus the initial cost of an investment. net asset valueThe value of all the holdings of a mutual fund, less the fund's liabilities. Net asset value (NAV)The value of a fund's investments. For a mutual fund, the net asset value per share Net book valueThe current book value of an asset or liability; that is, its original book value net of any Net investmentGross, or total, investment minus depreciation. 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