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equity business definition
- In a brokerage account, the market value of securities minus the amount borrowed. Equity is particularly important for margin accounts, for which minimum standards must be met.
- Stock, both common and preferred. For example, an investor may prefer investing in equities instead of in bonds. Also called equity security.
- In accounting, funds contributed by stockholders through direct payment and through retained earnings. See also owners' equity.
- The market value of real estate less the balance on any financing. A home with a market value of $400,000 and a remaining loan balance of $275,000 has equity of $400,000 less $275,000, or $125,000.
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