What is face value?

Face value, also referred to as par value or nominal value, is the value shown on the face of a security certificate, including currency. The concept most commonly applies to stocks and bonds, so it is particularly important to bond and preferred stock investors.

What is face value in investing?

Face value is a term that's important for investors to know. Though it's more commonly used for bonds, you may also hear it applied to stocks. Here's how it applies to your investments. Image source: Getty Images. What is face value? In stock investing, the face value is the original value of the stock, as listed on the certificate.

What is the face value of a stock?

For stocks, the face value is the stock's original cost, as listed on the certificate. In reality, the par value of a stock is unimportant. It can be set at a low, arbitrary amount, especially in countries like the U.S. Many U.S. companies deliberately issue stocks with very low par values due to specific state regulations.