The increase in the value of a financial or physical asset over its normal life-time or a specific period of time. For example, a country’s currency may increase in value if its price moves up against another currency or other currencies. An appreciated currency, in that sense, is more valuable than before. The same token applies to any type of assets such as stocks, bonds, commodities, real estate, etc. The value of a stock may appreciate if the company’s performance is improved. Appreciation can result from increased demand on a given asset or decreased supply thereof. Furthermore, it can occur following changes in macroeconomic aggregates such as inflation or interest rates.
Appreciation is the reverse of depreciation.
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