Reading the terms: book value and market value give different amounts for the same holdingThe price you paid and the price today are two different numbers
In the material the Bank of Japan published on October 30 on revising the pace of its ETF sales, the annual pace appears twice: about JPY 860 billion on a book-value basis, and about JPY 2.46 trillion when converted to market value. Financial statements likewise measure securities and fixed assets differently depending on whether book value or market value is used. Using the published material, this article sets out the difference and how to read each figure.
Key points
- Book value is the amount recorded in the books, based on the price at which the asset was acquired; market value is the price the asset would fetch in the market today. The same asset gives a different amount depending on how it is measured
- The material shows the revised annual pace of sales as about JPY 860 billion at book value and about JPY 2.46 trillion converted to market value. A note states that the market-value conversion is calculated using the ratio of market value to book value of the ETFs sold since January of this year
- Before the revision the figure was about JPY 330 billion at book value, and the share of annual sales (at market value) in total trading value in the market as a whole was about 0.05 percent; after the revision it becomes about 0.1 percent
- The number of years needed to complete the sales is about 112 years before the revision and about 43 years after. A note states that this is calculated by dividing the balance of ETF holdings at book value as of the end of September this year by the annual amount of sales at book value
- The basic policy for disposal is stated as selling at an appropriate price in light of market conditions, avoiding losses to the Bank of Japan as far as possible, and avoiding any disruptive effect on the market as far as possible
What to do in practice
- When you see an amount in published material or in the news, check whether it is at book value or market value (the same asset can differ by several times)
- Check once how large the gap is between book value and market value for your own company's securities or real estate
In the material on how much of its stock bundles (ETFs) the Bank of Japan will sell each year, two amounts appear: about JPY 860 billion and about JPY 2.46 trillion. The quantity sold is the same; the amounts differ because the first is the price originally paid and the second is the price today. For the same thing, the amount changes depending on which price you count with.
Points
- The amount counted at the price originally paid is called book value, and the amount counted at today's price is called market value
- The same quantity of ETFs comes to about JPY 860 billion at book value and about JPY 2.46 trillion at market value
- So when you look at an amount, first check which price it was counted with
What the words mean
- Book value
- The amount written in the books, based on the price paid when the asset was bought
- Market value
- The amount you would get if you sold it now
- Bank of Japan: Bank of Japan, (Reference) Decision on the Revision of the Pace of ETF Sales (October 2026)
Economic news presents published statistics and outlooks. It is not investment solicitation or trading advice. Figures are as of publication and may be revised.
This article summarizes and explains materials published by government agencies and is not advice on any individual case. Rules can change, so for actual procedures and decisions always check the latest original materials and consult professionals such as tax accountants or labor and social security attorneys. English, Simplified Chinese and Traditional Chinese versions are translations prepared from the Japanese articles for convenience. If anything differs, the Japanese text and the original source take precedence.