{"id":9847,"date":"2023-01-23T13:10:33","date_gmt":"2023-01-23T07:40:33","guid":{"rendered":"https:\/\/www.tickertape.in\/glossary\/?p=9847"},"modified":"2023-02-01T17:02:14","modified_gmt":"2023-02-01T11:32:14","slug":"equity-meaning-components-calculation-and-examples","status":"publish","type":"post","link":"https:\/\/www.tickertape.in\/glossary\/equity-meaning-components-calculation-and-examples\/","title":{"rendered":"Equity: Meaning, Components, Calculation and Examples"},"content":{"rendered":"\n

The promoters start a company with their own money. They can also raise funds by taking the public\u2019s money by giving them part ownership and\/or borrowing some money from friends, relatives, banks and other financial institutions. In general, these are the sources of funds for any company at any given point of time. Technically, they are called equity and debt. <\/p>\n\n\n\n

Equity represents the portion of funds that is contributed by the owners. Here, there is no distinction between the promoters who founded the company, subsequent owners if any other person acquires shares of the company and the part owners who subscribe to the shares through capital<\/a> markets. On the other hand, debt represents that portion where the ownership does not dilute. The lenders charge interest instead. Therefore, this is also referred to as external liabilities. <\/p>\n\n\n\n

Let\u2019s understand what equity is all about. <\/p>\n\n\n\n

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