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Saving & Investing

Capital Appreciation

Also called: price appreciation, growth in value

Capital appreciation is the increase in an asset's price over time, as distinct from the income it pays. It's the growth half of total return, and it's tax-deferred: you owe nothing until you sell, unlike dividends and interest that are taxed as they arrive. That asymmetry is why appreciation-heavy assets suit taxable accounts and income-heavy assets suit sheltered ones.

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