A:

The term "above water" is used to describe any situation in which the ending or current value of a subject is higher than its beginning or opening price.

In accounting, an asset with a value that has appreciated is said to be "above water" because the price at which it could be sold exceeds the price paid. In financial markets, the stock market is said to have stayed "above water" when it finishes higher than its previous close. In personal investing, one's trading positions are said to be "above water" when values remain above the price at which they were bought or when values fall below the price at which they were sold short. Finally, a company that remains financially viable occasionally may be referred to as being "above water".

Similarly, an asset, index or security is said to be "treading water" when its worth equals the approximate purchase price. Furthermore, an asset, index or security is said to be "below water" when its worth falls below the purchase price.

To read more on this subject, see The Hidden Value Of Intangibles.

This question was answered by Justin Bynum.

RELATED FAQS
  1. What is "marginalism" in microeconomics and why is it important?

    Find out what economists mean by marginal utility or cost and why marginalism is such an important concept in microeconomic ... Read Answer >>
  2. How can particular scarcities benefit specific stocks?

    Learn about scarce resources, such as crude oil and water. Explore how companies that produce these resources have benefited ... Read Answer >>
  3. How can marginal utility explain the 'diamond/water paradox'?

    Learn why a diamond is valued more highly than a bucket of water or why a professional athlete is valued more highly than ... Read Answer >>
  4. What's the difference between the hurdle rate and the high water mark?

    Discover how hurdle rates and high water marks are used by hedge funds for calculating incentive or performance fees charged ... Read Answer >>
  5. What is the difference between marginal utility and marginal value?

    Find out what marginal utility and marginal value mean in economics and why these terms sometimes overlap to describe the ... Read Answer >>
  6. How strongly does government regulation impact the utilities sector?

    Read about the impact of government regulation on the utilities sector, particularly as is pertains to the water and electricity ... Read Answer >>
Related Articles
  1. Professionals

    Risks to Consider When Investing in Water

    Investing in water should be a lock. But water is volatile and could see as many risks as potential rewards.
  2. Personal Finance

    Looking for Cost-Effective Ways to Save Water?

    There are lots of things you can do to save water at home while reducing your ecological footprint at the same time. Here are five simple ways to do it.
  3. Stock Analysis

    In Focus: Water Scarcity

    After a discussion, sponsored by CDP, we share the importance of water disclosure as it relates to businesses operating amid increasing water scarcity.
  4. Professionals

    Top ETFs, Mutual Funds for Investing in Water (PHO, PIO)

    The nation's water supply is declining as demand is increasing. This presents an investment opportunity, just mind your liquidity.
  5. Options & Futures

    Water

    One of the most important natural resources we have is water as it is a necessity in our survival.
  6. Investing News

    Should Water Be Privatized?

    Could water privatization mean lower costs, greater efficiency and higher quality compared to public sector providers? A look at the evidence so far.
  7. Stock Analysis

    How Procter and Gamble Plans to Deliver 15 Billion Liters of Clean Water by 2020 (PG)

    Learn how Procter & Gamble plans to deliver 15 billion liters of clean drinking water by 2020 through its Children's Safe Drinking Water program.
  8. Investing Basics

    Water Investments: Will They Sink or Swim?

    Will these water-related investments sink or swim?
  9. Personal Finance

    Bottled Water

    Fads are always coming and going, but some have shown unexpected staying power.
  10. Personal Finance

    Bottled Water

    Consumers just can't live without these costly items.
RELATED TERMS
  1. Above Water

    1. Refers to the condition of a company's asset when its actual ...
  2. Produced Water

    Waste water generated during the production of oil and natural ...
  3. Water ETF

    An exchange-traded fund that invests in companies operating in ...
  4. Water Quality Improvement Act Of 1970

    Legislation that expanded the federal government's authority ...
  5. Palisades Water Index

    A stock market index that gauges the performance of global water ...
  6. Watered Stock

    Stock that is issued with a value much greater than the value ...

You May Also Like

Hot Definitions
  1. Return On Invested Capital - ROIC

    A calculation used to assess a company's efficiency at allocating the capital under its control to profitable investments. ...
  2. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  3. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  4. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  5. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  6. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
Trading Center