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. 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 >>
  2. 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 >>
  3. 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 >>
  4. 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 >>
  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. What can cause an asset to trade above its market value?

    Learn some of the factors that can affect the price of an investment asset and the major reasons why an asset might trade ... Read Answer >>
Related Articles
  1. Investing

    Four Interesting Ways to Invest in Water (PHO, CGW)

    The U.S. and many other countries are widely expected to invest in water infrastructure and equipment on an unprecedented scale over the next several years – ostensibly to make up for decades ...
  2. Investing

    Water: The Ultimate Commodity

    Opportunities to invest in this scarce resource are flowing freely - dive in!
  3. Investing

    Opportunities In The Emerging Market's Water Crisis

    Water scarcity and increasing demand caused by population growth is one of the most compelling long-term portfolio themes.
  4. Investing

    Top 3 ETFs for Investing in Water in 2017

    It may be time to look at a scarce commodity that isn't getting the investor attention it deserves.
  5. Investing

    Water-Related Investments Are Making A Splash

    There’s no doubt about it. The world is facing a water crisis. However, for forward thinking investors, that could mean a huge opportunity.
  6. Investing

    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.
  7. Investing

    Global Water Resources Trades Ex-Dividend Thursday (GWRS)

    Global Water will send its dividend payment on Oct. 31 to shareholders of record as of Oct. 17.
  8. Investing

    5 Water Stocks To Tap Into

    An increase in population and pollution has made water a fragile resource.
  9. Investing

    Is Water The Next Big Commodity?

    An increase in both population and pollution has made water a very fragile and important resource. Learn the key players.
  10. Investing

    With Fracking It’s All About Water Management

    It takes an awfully large amount of water to frack an oil and gas well these days. Given the growth projections for production activity in the U.S. and Canada, water management could be one of ...
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 ...
Hot Definitions
  1. Dumping

    In international trade, the export by a country or company of a product at a price that is lower in the foreign market than ...
  2. Tender Offer

    An offer to purchase some or all of shareholders' shares in a corporation. The price offered is usually at a premium to the ...
  3. Ponzi Scheme

    A fraudulent investing scam promising high rates of return with little risk to investors. The Ponzi scheme generates returns ...
  4. Dow Jones Industrial Average - DJIA

    The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange ...
  5. Revolving Credit

    A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is ...
  6. Marginal Utility

    The additional satisfaction a consumer gains from consuming one more unit of a good or service. Marginal utility is an important ...
Trading Center