An acronym for present discounted value; the value (also known as present value) that is calculated today for a stream of future payments associated with, i.e., generated from, an instrument/ a security/ a product/ an investment, etc. It is calculated by discounting payments due in the future and summing them up in a single figure. It is the value today of a future payment, or stream of payments (cash flows), discounted at a specific interest rate (compound interest or discount rate). For example, the present value of $1,000 to be received 5 years from now is about $620.921 by application of a discount rate of 10% interest compounded annually.

For a debt security or similar structure, the present value is used alongside the yield as a key input for analyzing the value of the security and its performance over time.

In general, present value is a technique used to figure out the current value of future cash flows, based on the notion that money is more valuable in the present than in the future. Present value (PV) is calculate the income from multiple types of securities, or instruments such as loans, mortgages, and other arrangements or structures that generate value over time, and hence their full value has to be determined using their future cash flow.

The concept of a present discounted value (PDV) reflects the amount that should be paid in the present for a stream of expected future payments. It is normally used to calculate appropriate prices for stocks, bonds and other similar instruments/ assets.