 Intrinsic value: Perhaps the most important characteristic of financial assets is that their price can vary enormously with the attitudes of investors. Put simply, there are two main factors that determine the price of a financial asset: (i) the credibility or strength of the underlying promise (which will depend on the future cash flows generated by the asset); and (ii) its transferability or popularity within the market, that is, how many other investors are interested in buying the asset. In the process known as “price discovery”, investors assess these factors based on the information available to them, and then make bids to buy or sell the asset, which in turn sets its price on the market (Mishkin 2016, Pilbeam 2010).