Investment Valuation Model

Investment Valuation Model (IVM)

The basic mathematical technique of finance that calculates the value of an investment as the present value of all future cash flows expected to be generated by the investment.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Investment Valuation Model

A mathematical calculation of the value of an investment. An IVM computes this value as the present value of all returns the investment is likely to generate. This can help in making investment decisions. For example, if a company's share price is $5 and an IVM computes that the present value of returns will be $7 per share, the investment is likely to be profitable. See also: option pricing model.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
Mentioned in
Copyright © 2003-2025 Farlex, Inc Disclaimer
All content on this website, including dictionary, thesaurus, literature, geography, and other reference data is for informational purposes only. This information should not be considered complete, up to date, and is not intended to be used in place of a visit, consultation, or advice of a legal, medical, or any other professional.