For instance, an appraised value of a home is the number of dollars that a person in the ordinary course of dealing would be likely to pay for it.
That value, however, may be quite different if appraised for other purposes, such as replacement value for an insurance policy or for taking by eminent domain.
What is the value of your investment? It's the amount that a willing buyer and a willing seller are willing to transfer it for. With publicly traded stocks, this is easy to establish because there is frequent trading, each trade representing such an agreed upon price. Values can also be established in other ways. There are other ways to establish the value (known as an "appraisal") for something that is unique or not actively traded. Real estate appraisers establish value by finding prices of "comps" (comparable properties) as well as considering the income that an investment property may generate (e.g. from rental or lease income). A third approach to a real estate appraisal is to establish what the replacement cost would be. But there are just ways to justify the price that someone may be willing to buy or sell a property for.
