how appreciation works
appreciation can be used to refer to an increase in any type of asset such as a stock bond currency or real estate for example the term capital appreciation refers to an increase in the value of financial assets such as stocks which can occur for reasons such as improved financial performance of the company just because the value of an asset appreciates does not necessarily mean its owner realizes the increase if the owner revalues the asset at its higher price on their financial statements this represents a realization of the increase another type of appreciation is currency appreciation the value of a country s currency can appreciate or depreciate over time in relation to other currencies capital gain is the profit achieved by selling an asset that has appreciated in value 