Plain-English definitions, reviewed by an independent investor
Intrinsic Value
Intrinsic value is the real worth of an asset based on fundamentals, not its market price.
Intrinsic value is the real worth of an asset based on fundamentals, not its market price.
(Fundamental worth; the gap to price is the edge)
Why it matters
It is what value investors estimate to decide if something is cheap.
Common confusion
It is an estimate, not a fact; two analysts can land far apart.
Frequently Asked Questions
Intrinsic vs market value?
Market is the price; intrinsic is what it is worth underneath.
Used for options?
Option intrinsic value is the in-the-money amount, if any.