Current Market Value - CMV

AAA

DEFINITION of 'Current Market Value - CMV'

The resale valuation attached to a security held long in an investor's margin account. The current market value is usually taken as the closing price for listed securities or the bid price offered for over-the-counter (OTC) securities.

INVESTOPEDIA EXPLAINS 'Current Market Value - CMV'

In a margin account, an investor essentially engages in owning securities purchased for a total price greater than the amount of cash he/she has in his/her account; the investor borrows the excess cash needed from his/her brokerage to fund the remainder of the purchase.

Due to this leveraged purchase situation, the brokerage account values the investor's assets periodically, and if the total account value falls below the required margin amount, the brokerage will require the investor to top up the account with cash or to liquidate some or all of his or her securities into cash. The current market value (CMV) is the standardized price that is taken periodically to track the change in value of the investor's assets.

RELATED TERMS
  1. Mark To Management

    The theory that a good, asset/liability or service can be assigned ...
  2. Hedge Accounting

    A method of accounting where entries for the ownership of a security ...
  3. Margin Call

    A broker's demand on an investor using margin to deposit additional ...
  4. Margin Account

    A brokerage account in which the broker lends the customer cash ...
  5. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin ...
  6. Mark To Market - MTM

    1. A measure of the fair value of accounts that can change over ...
RELATED FAQS
  1. What does "buy on the cannons, sell on the trumpets" mean?

    All the events and news that happen around the world can have a great impact on the stock market. Very often, if a war breaks ... Read Full Answer >>
  2. What is a margin account?

    A margin account is an account offered by brokerages that allows investors to borrow money to buy securities. An investor ... Read Full Answer >>
  3. If a company has a high debt to capital ratio, what else should I look at before ...

    A variety of equity valuation metrics can be utilized to evaluate a company along with the debt to capital ratio to get a ... Read Full Answer >>
  4. How can a firm bring down its operating leverage?

    A company with a lower percentage of fixed costs and a higher percentage of variable costs uses less operating leverage. ... Read Full Answer >>
  5. What is the long-term outlook of the banking sector?

    The long-term outlook of the banking sector remains cyclical, but with less volatility than in the past. Given structural ... Read Full Answer >>
  6. What are the biggest risks involved with financial spread betting?

    Financial spread betting is a type of financial derivatives product used to speculate the price movements of a security. ... Read Full Answer >>
Related Articles
  1. Forex Education

    Forex: Money Management Matters

    Currency trading offers far more flexibility than other markets, but long-term success requires discipline in money management.
  2. Bonds & Fixed Income

    Mark-To-Market: Tool Or Trouble?

    Mark-to-market accounting can be a valuable practice, but all bets are off when the market fluctuates wildly.
  3. Options & Futures

    Margin Trading

    Find out what margin is, how margin calls work, the advantages of leverage and why using margin can be risky.
  4. Brokers

    Private Equity's Returns Are Tempered By Its Risks

    Private equity firms adopt approaches to quickly hike up earnings and boost returns, but these investments come with big risks too.
  5. Credit & Loans

    The Pros & Cons Of Personal Loans vs. Credit Cards

    One is not like the other. We help you decide where to borrow money from.
  6. Brokers

    Interested in Derivative Products? Try CFDs

    A short article about the main risks and rewards of CFDs. These derivatives can help boost returns using leverage, but they could also magnify losses.
  7. Fundamental Analysis

    What is Gearing?

    Gearing, also called leverage, is the degree to which a company’s operations are funded by lenders versus shareholders.
  8. Stock Analysis

    Is Prospect Capital Exposed To Elevated Losses?

    According to a federal government report, the quality of leveraged loans has begun to deteriorate. Prospect Capital specializes in these types of loans.
  9. Mutual Funds & ETFs

    Buying ETFs on Margin Versus Leveraged ETFs

    Leveraged ETFs and investing in an ETF on margin both have their advantages and disadvantages.
  10. Investing

    Ready To Invest In Financial Leverage Funds?

    Whenever you invest in a leveraged financial fund or are thinking about doing so, it's important to know the risks that could weigh on its returns.

You May Also Like

Hot Definitions
  1. Venture-Capital-Backed IPO

    The selling to the public of shares in a company that has previously been funded primarily by private investors. The alternative ...
  2. Merger Arbitrage

    A hedge fund strategy in which the stocks of two merging companies are simultaneously bought and sold to create a riskless ...
  3. Market Failure

    An economic term that encompasses a situation where, in any given market, the quantity of a product demanded by consumers ...
  4. Unsystematic Risk

    Company or industry specific risk that is inherent in each investment. The amount of unsystematic risk can be reduced through ...
  5. Security Market Line - SML

    A line that graphs the systematic, or market, risk versus return of the whole market at a certain time and shows all risky ...
  6. Tangible Net Worth

    A measure of the physical worth of a company, which does not include any value derived from intangible assets such as copyrights, ...
Trading Center