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Ownership in a company, or the value of an asset after subtracting debt.
Equity has two common meanings. In investing, it means ownership in a company, which is why stocks are called equities. In accounting, it is what's left for owners after subtracting debts from assets.
A home worth $500,000 with a $300,000 mortgage gives you $200,000 of home equity.
Shareholders' equity on a balance sheet shows how much of a company is financed by owners versus lenders, a key clue to its financial health.
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