The estimated value of potential market price for an asset based on objective factors.

The term fair value can incorporate factors such as:

  • acquisition/production/distribution costs, replacement costs, or costs of close substitutes
  • actual utility at a given level of development of social productive capability
  • supply vs. demand

and subjective factors such as

  • risk characteristics
  • cost of and return on capital
  • individually perceived utility

Source: Wikipedia

It should be noted that a trending market reflects a dynamic fair value, while a range market reflects fluctuation between a relatively static fair value.