Market value
Under rate value ( English market value ) are understood in finance a current value , to a financial instrument (such as a Kurantmünze in circulation) at a given time has or to which it at the settlement billed is. Contrast is the face value . The exchange rate is also the value ratio of a national currency to foreign currencies, as roughly expressed in the exchange rate .
General
Legal tender only has a nominal value at which it must be taken in payment. All other financial instruments that have a nominal value also have a market value that generally differs from the nominal value. While the nominal value represents the value stated on the financial instrument, the market value is based on a current price, which is determined as a stock exchange price by listing on the stock exchange or over the counter on the money , capital or foreign exchange market by determining the price . The difference between nominal and market value is explained by supply and demand on the relevant market. The market value is obtained by multiplying the nominal value with the current price:
One US dollar - banknote with the face value "100 dollars" has thus at a foreign exchange rate of 0.8785 euros for one US dollar a share price of 87.85 euros.
species
The financial instruments with a market value include cash ( money substitutes ), securities ( stocks and bonds ), currencies , types , and precious metals . For transactions in foreign currency , the market value is also determined by the exchange rate . The fluctuations in the market value mean a price risk for the holder of these financial instruments , which he can hedge with hedge transactions . Forward transactions (for example currency forwards , currency options ) are particularly available for this purpose.
Value convention
The market value represents an important value convention when lending collateral to credit , on which the determination of the lending limit for securities and other financial instruments is based. Frequently changing market values therefore lead to fluctuations in the value of collateral valuation by credit institutions , particularly in the case of securities lombard loans , which according to Art. 224 (1) Capital Adequacy Ordinance (CRR) must be carried out daily in extreme cases. A decline in the market value can lead to the loan period being exceeded , for which the credit conditions with the clause of a significant deterioration in the financial situation provide for a right of additional collateral.
Accounting
The market value corresponds to the accounting of the commercial law term used "market price", which according to the strict lower of the § 253 para. 4 HGB the assets of current assets on the balance sheet date must be based if it is lower than the book value is of these financial instruments.
See also
literature
- Helmut Kahnt, Bernd Knorr: Old measures, coins and weights. A lexicon. Bibliographisches Institut, Leipzig 1986, licensed edition Mannheim / Vienna / Zurich 1987, ISBN 3-411-02148-9 , p. 386.