On a company's balance sheet, the amount of the funds contributed by the owners plus the retained earnings. Also referred to as "shareholders' equity".

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. It is the amount that the owner would receive after selling a property and paying off the mortgage.

In terms of investment strategies, equity is one of the principal asset classes. The other two are fixed-income and cash/cash-equivalents. These are used in asset allocation planning to structure a desired risk and return profile for an investor's portfolio. A capital market is a market for securities, where business enterprises and government can raise long-term funds. It is defined as a market in which money is provided for periods longer than a year, as the raising of short-term funds takes place on other markets. The capital market includes the stock market and the bond market.