InvestingAnswers Financial Dictionary
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Capital appreciation (also called a capital gain) is an increase in the value of an investment. It is the difference between the purchase price (the basis) and the sale price of an asset. Thus the formula for capital appreciation is:
Sale Price - Purchase Price = Capital Appreciation
Note that this formula assumes the sale price is higher than the purchase price. If an investor sells an asset for less than he or she paid, this is called a capital loss.
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