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Equity

In a general context this refers to a security such as shares that give the investor an ownership interest in the company. In an investment portfolio, equity is one of the main asset classes along with bonds and cash / cash equivalent. Shareholder’s equity on a balance sheet is the total assets minus the total liabilities. Equity can also refer to the residual value of a futures trading account if the holdings were sold at the current trading price.

This definition is for general information purposes only