The value of ownership of something. For a business, equity is a measurement of the value of the company made by calculating its total assets minus its total liabilities. For publicly traded companies, it is also the value of the shares that a company issues to its investors. For homeowners, it is the “valuation” that you own in your home, i.e. the property value less the mortgage loan outstanding.
EXAMPLE:
By paying off 2/3 of his home loan, he now has that money as equity that he can borrow from.
