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What is Equity ?

Equity Investment refers to purchasing and holding the shares in the stock market by individual persons and firms in anticipation of generating income from dividends and capital gains equity shareholders have the rights to vote that is they can vote the board of directors and can obtain the skill of professional fund managers who are in charge of the funds a calculation can be made in relevance to the then a private equity means any other stock or security which represents ownership over a company.

The balance sheet of a company on which the funds which are contributed by the owners or shareholders with retained earnings and losses can also be called as stockholders or shareholders.Equity is very important for share market because it represents the value of stake of an investor in his investment those investors who hold stock in a company have been interested in personal equity in the company represented by shares.

Equity can be categorized by market value or book value when an invest which is done and is publicly traded there is also another type of equity known as private equity in which private investors like institutions, pension funds, and university endowments are there.

A final type of private equity is a Private Investment in a Public Company, in which private investment firm mutual funds and other qualified investors buy a stock of a  company at a discount to the current market value per share for raising capital.

Stocks and Equity are one and the same and both represent the ownership on an entity and are traded in stock exchanges for example when a trader buys a share he expects returns in the form of dividends equity also means stocks or shares this term is used interchangeably in the stock market.

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