Intrinsic value is the perceived or calculated value of an asset, investment, or a company and is used in fundamental analysis and the options markets.
 | | Term of the Day | Words to Know | | |  | | Intrinsic Value | Intrinsic value is a measure of what an asset is worth. This measure is arrived at by means of an objective calculation or complex financial model, rather than using the currently trading market price of that asset.
In financial analysis this term is used in conjunction with the work of identifying, as nearly as possible, the underlying value of a company and its cash flow. In options pricing it refers to the difference between the strike price of the option and the current price of the underlying asset. | | Read More » | | Related to "Intrinsic Value" | | | | SPONSORED BY SMARTASSET | | Financial Advisor Mistakes to Avoid | | Choosing a financial advisor is a major decision that can determine your financial trajectory for years to come. SmartAsset offers tips on common mistakes to avoid. | | Learn More » | | | Fundamental Analysis | | Fundamental analysis is a method of measuring a stock's intrinsic value. Analysts who follow this method seek out companies priced below their real worth. | | Read More » | | | | | | CONNECT WITH INVESTOPEDIA | | | | | | | |
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