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Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Capital Appreciation

Definition:

Yes, we all appreciate having capital. But this term applies when the value of capital goes up or, well, appreciates.

Important note: you don't have to do anything for capital to go up in value. Let's say you buy a stock for $20, and after a year its value is $25. It has appreciated $5 a share. You didn't have to do anything, and you don't have to sell, trade, or do anything now. You can just sit back and appreciate the appreciation.