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equity

 - 8 dictionary results

eq⋅ui⋅ty

[ek-wi-tee]
–noun, plural -ties.
1. the quality of being fair or impartial; fairness; impartiality: the equity of Solomon.
2. something that is fair and just.
3. Law.
a. the application of the dictates of conscience or the principles of natural justice to the settlement of controversies.
b. a system of jurisprudence or a body of doctrines and rules developed in England and followed in the U.S., serving to supplement and remedy the limitations and the inflexibility of the common law.
c. an equitable right or claim.
d. an equity of redemption.
4. the monetary value of a property or business beyond any amounts owed on it in mortgages, claims, liens, etc.
5. Informal. ownership, esp. when considered as the right to share in future profits or appreciation in value.
6. the interest of the owner of common stock in a corporation.
7. (in a margin account) the excess of the market value of the securities over any indebtedness.
8. (initial capital letter) Actors' Equity Association.

Origin:
1275–1325; ME equite < L aequitās. See equi-, -ty 2
Dictionary.com Unabridged
Based on the Random House Dictionary, © Random House, Inc. 2009.
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eq·ui·ty   (ěk'wĭ-tē)   
n.   pl. eq·ui·ties
  1. The state, quality, or ideal of being just, impartial, and fair.

  2. Something that is just, impartial, and fair.

  3. Law

    1. Justice applied in circumstances covered by law yet influenced by principles of ethics and fairness.

    2. A system of jurisprudence supplementing and serving to modify the rigor of common law.

    3. An equitable right or claim.

    4. Equity of redemption.

    5. The market value of securities less any debt incurred.

    6. Common stock and preferred stock.

  4. The residual value of a business or property beyond any mortgage thereon and liability therein.

    1. The market value of securities less any debt incurred.

    2. Common stock and preferred stock.

  5. Funds provided to a business by the sale of stock.


[Middle English equite, from Old French, from Latin aequitās, from aequus, even, fair.]
The American Heritage® Dictionary of the English Language, Fourth Edition
Copyright © 2009 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
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Cultural Dictionary

equity

A body of rules or customs based on general principles of fair play rather than on common law or statutory law.


equity

In real estate, the financial value of someone's property over and above the amount the person owes on mortgages. For example, if you buy a house for $100,000, paying $20,000 down and borrowing $80,000, your equity in the house is $20,000. As you pay off the principal of the loan, your equity will rise.

The American Heritage® New Dictionary of Cultural Literacy, Third Edition
Copyright © 2005 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
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Word Origin & History

equity 
c.1315, from O.Fr. equite, from L. æquitatem (nom. æquitas) "equality, conformity, symmetry, fairness," from æquus "even, just, equal." As the name of a system of law, 1591, from Roman naturalis æquitas, the general principles of justice which corrected or supplemented the legal codes.
Online Etymology Dictionary, © 2001 Douglas Harper
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Financial Dictionary

Equity

1. Stock or any other security representing an ownership interest.

2. On the balance sheet, the amount of the funds contributed by the owners (the stockholders) plus the retained earnings (or losses). Also referred to as "shareholder's equity".

3. In the context of margin trading, the value of securities in a margin account minus what has been borrowed from the brokerage.

4. In the context of real estate, the difference between the current market value of the property and the amount the owner still owes on the mortgage. Thus, it is the amount, if any, the owner would receive after selling a property and paying off the mortgage.

Investopedia Commentary


Equity is a term whose meaning depends very much on the context. In general, you can think of equity as ownership in any asset after all debts associated with that asset are paid off. For example, a car or house with no outstanding debt is considered the owner's equity since he or she can readily sell the items for cash. Stocks are equity because they represent ownership of a company, whereas bonds are classified as debt because they represent an obligation to pay and not ownership of assets.

Related Links

Stock Basics Tutorial
Keep Your Eyes On The ROE
Margin Trading Tutorial
To Rent or Buy? The Financial Issues - Part 1

See also: Asset, Balance Sheet, Private Equity, Stock, Stockholder's Equity

Investopedia.com. Copyright © 1999-2005 - All rights reserved. Owned and Operated by Investopedia Inc.
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Financial Dictionary

equity

  1. 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.

  2. Stock, both common and preferred. For example, an investor may prefer investing in equities instead of in bonds. Also called equity security.

  3. In accounting, funds contributed by stockholders through direct payment and through retained earnings. See also owners' equity.


Wall Street Words: An A to Z Guide to Investment Terms by David L. Scott.
Copyright © 2003. Published by Houghton Mifflin.
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Legal Dictionary

Main Entry: eq·ui·ty
Pronunciation: 'e-kw&-tE
Function: noun
Inflected Form: plural -ties
Etymology: Latin aequitat- aequitas fairness, justice, from aequus equal, fair
1 a : justice according to fairness esp. as distinguished from mechanical application of rules equity> equity require it to be paid for —Federal Reporter A. Magruder> b : something that is equitable : an instance of equity equities>
2 a : a system of law originating in the English chancery and comprising a settled and formal body of substantive and procedural rules and doctrines that supplement, aid, or override common and statutory law equity, arising under this Constitution —U.S. Constitution article III> —see also CHANCERY —compare COMMON LAW, LAW
NOTE: The courts of equity arose in England from a need to provide relief for claims that did not conform to the writ system existing in the courts of law. Originally, the courts of equity exercised great discretion in fashioning remedies. Over time, they established precedents, rules, and doctrines of their own that were distinct from those used in the courts of law. Although for a time the courts of equity rivaled the law courts in power, the law courts maintained an advantage partly as a result of forcing the equity courts to hear only those cases for which there was no adequate remedy at law. The courts of law and equity were united in England in 1873. Courts of equity also developed in the United States, but in most states and in the federal system courts of law and courts of equity have been joined. The courts apply both legal and equitable principles and offer both legal and equitable relief, although generally equitable relief is still granted when there is no adequate remedy at law. b : the principles that developed in the courts of equity : justice in accordance with equity <equity treats a devisee who procures a will by fraud as a constructive trustee —W. M. McGovern, Junior et al.>; also : justice in accordance with natural law c : a court of equity equity —O. W. Holmes, Junior>
3 : a body of doctrines and rules developed to enlarge, supplement, or override any narrow or rigid system of law
4 a : a right, claim, or interest existing or valid in equity b : the money value of a property or of an interest in property in excess of any claims or liens (as mortgage indebtedness) against it c : a risk interest or ownership right in property; specifically : the ownership interests of shareholders in a company d : the common stock of a corporation —compare ASSET, DEBT
Merriam-Webster's Dictionary of Law, © 1996 Merriam-Webster, Inc.
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