The value of an asset at the start of a time period (i.e., stocks at the start of a trading session or real estate upon appraisal).
Hans wanted to impress his neighborhood crush, Gertrude, who liked German cars. So he went to visit a buddy who sold knock-off merchandise like "Lewis Vuittoon" bags and "Tug Hewer" watches and bought a BMV (similar to a BMW but with minor logo tweaks) for $2,000 (its beginning market value).
Turns out Gertrude is more of a Volkswagen fan, so Hans returned the car the next day, receiving its ending market value of $500 (because of depreciation), which then becomes the next day's beginning market value.
Related or Semi-related Video
Finance: What is Net Asset Value (NAV)?5 Views
finance a la shmoop what is net asset value or nav nav is how mutual fund
shares are valued or priced at the end of each trading day take a look at this
mutual fund right here it has fourteen hundred seventy shares of Google and [mutual funds document]
three hundred shares of Amazon and five hundred shares of IBM and while you get
the idea at the end of each day the ask prices in
the bid-ask spread ie the ask is the price at which somebody will sell these
shares are added up and yep totaled in this case there are a hundred fourteen
different names in the portfolio and seven million bucks in cash all of which
total eighty-two point three million dollars in value at the end of this day
well there are two million shares outstanding exactly at this moment so
the nav at today's close well it's eighty two point three million divided
by two million shares outstanding to get forty one dollars fifteen cents per
share that 4115 is the nav of the mutual fund and what happens when more
investors join by you know putting in cash well like let's say somebody
invests a million dollars at the end of today well then the fund goes from [money lining up in rows]
having seven million bucks in cash to having eight million bucks in cash and
that investor just bought 1 million / 4115 4 nav share self that mutual fund
company printed out of thin air an incremental twenty four thousand
three hundred one shares bringing its total the two million twenty four
thousand three hundred one the total value of the fund is now eighty three
point three million bucks up from yesterday's eighty two point three
million and the shares outstanding in the fund are now two million twenty four
thousand three hundred one and yeah the nav didn't change just the shares
outstanding and it's nav not not pronounced nav although it'd be kind of
a cool name for a mutual fund anything never like find where you're going nav [tiny red car on map]
brought to you by ways
Up Next
What is Assessed Value? Assessed value is used to determine a piece of real estate’s tax liability. An assessor measures what the property is wor...
What is Fair Market Value? Fair market value is what something would sell for in the open market given the knowledge of buyers and sellers. It’s...
What is a Future Value calculation? Future Value is used to find the value of an investment at some point in the future based on expected growth or...
Terminal value is the end value of...something. In finance, it usually refers to the cash flow of a company that is sold, and that flow...stops flo...