fair value - Business Definition
The American Heritage® Dictionary of Business Terms Copyright © 2010 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.
- In accounting, the price at which an asset can be bought or sold in a current transaction.
- In futures trading, the equilibrium price for a futures contract.
- The price at which an asset should trade based on all relevant factors. See also efficient market.
fair value - Investment & Finance Definition
- The price that an asset or investment can be bought or sold at. Quoted market prices of instruments traded on exchanges give an accurate reading of fair value.
- The theoretical value of a futures or options contract that is derived from a mathematical valuation model. Also called non-arbitrage value.
Used by arrangement with John Wiley & Sons, Inc.