Market value
A short, practical note on market value, with the public definition from IVS / Red Book (effective 31 January 2025).
In my practice I treat market value as an estimate, at a stated date, of the amount for which an asset would exchange between a hypothetical buyer and seller, both willing, informed and under no compulsion. It is not the asking price, nor the price someone actually paid: those prices are evidence, which I analyse and adjust. The definition is the same in IVS and the Red Book. It is the basis of value I see most often in lending, financial reporting and transactions, but it is not the only one.
“The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction […]”
Source: IVS Glossary 10.18 (= IVS 102 Appendix A10.01; Red Book Part 2 Glossary remete para IVS 102)
Common confusion
Market value ≠ price: a price is a fact; market value is a judgement, tied to a date.