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.

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