Groundlearn / Glossary / Future value
Future value (FV)
Also called FV. A CFA term, defined in plain English with the distinction examiners test.
What it means
What a sum invested today grows to by a stated date at a stated rate.
Where it appears in the syllabus
- Quantitative MethodsCFA Level I · exam weight 11–14% · Returns and benchmarks, time value, distributions, portfolio maths, regression.
On the calculator
Time value of money questions on the BA II Plus come down to five keys and a few traps (payments per year, BGN mode, the sign of cash flows). Watch the keystrokes video.
Related terms
- AlphaReturn in excess of what the asset’s risk exposures would predict.
- AnnuityA series of equal cash flows at equal intervals.
- Arithmetic meanThe sum of the observations divided by their number.
- Bayes’ formulaA rule for revising the probability of an event in the light of new information, using how likely that information is…
- BootstrapResampling the observed data with replacement to estimate the sampling distribution of a statistic, without assuming a…
- Capital market lineThe capital allocation line that runs from the risk-free asset to the market portfolio, the steepest available.
Educational content only. This is not financial, investment, legal or regulatory advice. Check the official curriculum for your own exam before relying on any definition here.
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