Murex, Client Work to Comply with Regulator Fair Value Determination Request
The most common measure of the market liquidity of an asset is the size of its bid-ask spread. The more liquid the asset, the smaller the bid-ask spread, and vice versa. Under IFRS 13, this spread must be used to compute the fair value of an asset or liability. For an instrument that has a
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Editorial Team
- September 22, 2022
- 1 minute
Peruvian financial institution sought and gained oversight body approval to use approach
The most common measure of the market liquidity of an asset is the size of its bid-ask spread. The more liquid the asset, the smaller the bid-ask spread, and vice versa.
Under IFRS 13, this spread must be used to compute the fair value of an asset or liability.
For an instrument that has a bid price and ask price, fair value measurement under IFRS 13 requires the use of the most representative price within the bid-ask spread.
