Defining the Value of an Investment
When evaluating which investments to add to or subtract from your portfolio, one factor that might influence your decision is whether a particular stock, bond or fund seems like a good value. But there are many ways to define the value of an investment, and these can vary based on the type of investment product you're considering.
Here are some common methods of measuring value:
Market value is the price buyers and sellers agree to pay or accept for a security at any given moment in time. For stocks and exchange-traded funds (ETFs), market value is a component of market capitalization (or market cap), which is simply the current share price multiplied by the number of outstanding shares.
Source Fool.com
