equity

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작성자달봉이 조회 35회 작성일 2020-09-05 23:37:41 댓글 0

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What is Equity

What is Equity? Equity is a term used in accounting, in real estate and home-ownership, in investing, as well as in startup financing and valuation. The meaning of the term equity is very similar in the various areas where it is used, so it will be good to review all four of these to get the best understanding.

In accounting, equity is a term that you will find on the balance sheet. What you own is on the left: assets. What you owe is on the right: liabilities and equity. Equity is the book value of the shareholder capital. The accounting equation tells you that assets equal liabilities plus equity. That also means that equity equals assets minus liabilities.

Equity on a balance sheet goes up when a company is profitable: the net income for the year gets added to equity through retained earnings. Equity on a balance sheet goes down when the company is loss-making (losses “eat up” the equity), or when the company pays a dividend to its shareholders.

Equity in home-ownership works very similar to equity on the balance sheet. What we own is on the left: the house worth $500.000. What we owe is on the right: $400.000 of mortgage loan from the bank, and the owner of the house, Jim, has $100.000 of equity in the house. Equity in home-ownership is what a home is worth minus how much you owe to the bank.

Just like equity on the balance sheet of a company can go up or down, the equity that you have in your home can go up or down. If Jim is paying down the mortgage on his house by $50.000, then the amount of the loan outstanding will decrease and his equity in the house will increase. If the market value of the house increases, then Jim’s equity in the house will increase. Remember that equity is what a home is worth minus how much you owe to the bank. If the market value of the house decreases, then Jim’s equity in the house will decrease, or even become negative. Jim will need to have a conversation with the bank to make a remediation plan to get back to positive equity, or in the worst case scenario Jim might lose the ownership of the house and the bank will need to take a partial write-off of its outstanding loan.

Investing in equity. Remember the example of the small manufacturing business that owned a machine, had a loan from a bank, and equity from one shareholder. What if we make that a big manufacturing business that owns lots of machines at different sites totaling $1 billion, has many loans outstanding totaling $800 million that are publicly traded in the bond market, and has many different shareholders as the certificates of ownership, the equity, is traded publicly as well. As an investor, you have the choice of buying bonds (which would have a predetermined interest rate, and has the machines as collateral), or the choice of buying stocks (which are perceived as having more downside risk as well as more upside potential). Invest in debt, or invest in equity.

Equity in a startup company. How do you put a “price” on what is essentially so far just an idea, that still has to be developed and will find many ups and downs along the way? The company does not have any assets, liabilities and equity yet. The financing and valuation depend on the estimate of the revenue, profit and cash flow that the business idea might bring in the future. A good way to learn about startup companies in the tech field is the comedy series “Silicon Valley”. What happens if the app you are developing turns out to have a great compression algorithm, you are courted by investors ready to fund you, and your friends and roommates suddenly become your employees while you become the CEO? In season one of “Silicon Valley”, landlord/incubator Erlich Bachman has 10% of the shares in startup company Pied Piper, eccentric billionaire Peter Gregory buys 5% for $200.000, and the three employees Gilfoyle, Dinesh and Jared get 3% each in what someday might be a multi-billion $ company. By my math, that sets the CEO Richard Hendricks up with 76% of the shares in the company. In subsequent seasons of the comedy series, Pied Piper goes through various rounds of financing, as well as acquisitions and other ownership changes.

Having equity can be a great thing. Equity has potential risks as well as potential rewards. The term equity is used in accounting, in home-ownership, in investing, and in start-up financing and valuation. Probably the easiest metaphor to remember is equity in home-ownership: what a home is worth minus how much you owe to the bank.

Philip de Vroe (The Finance Storyteller) aims to make strategy, #finance and leadership enjoyable and easier to understand. Learn the business and accounting vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better #investing decisions. Philip delivers #financetraining in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
The Finance Storyteller : Enjoyed this video explaining "Equity"? Then please subscribe to the channel, and watch my video on the Accounting Equation next: https://www.youtube.com/watch?v=OYql7Y9NnBg
shahad chasib : If you want to know what EQUITY is
watch this link in ARABIC

kc444 with no videos : What is the difference between divened and equity?
kc444 with no videos : Is equity the amount investors like in dragon den pay to the company to hope for dividend???
Maryam مريم : is Equity here the value of the shares or ‘what we owe’?? Since Equity in this video is defined by ‘what we owe’... also when a company is profitable, Equity (what we owe-as defined in the video) increases because we’re borrowing more to fund more machinery, equipment?
jabir abdulqadir nur : I'm learning a lot! Thanks teacher ♥️ may God bless you
Maryam مريم : Also does Jane get both her Equity money back + dividends?
Maryam مريم : Also why does equity go up.. when the company is profitable? Shouldn’t dividends go ‘up’?
Pradeep Charan : 0:32 wrong assets are on right side and liability on left
W. Oei : What is equity gap? Does it mean Negative Equity where Liability exceeds Asset?

Equity | Official Trailer HD (2016)

When Senior investment banker Naomi Bishop (Anna Gunn) is passed over for a promotion at her firm, she fights for the opportunity to take a start-up public, hoping this promising IPO will secure her a place at the firm’s highest level. But when an employee at the start-up raises questions about a possible crack in the company’s walls, Naomi must decide whether to investigate rumors that may compromise the deal, or push forward with the confidence her superiors expect.

Soon Naomi finds herself tangled in a web of deception and office politics and begins to question if there is anyone she can trust. As the IPO draws closer, Naomi sees that the choices she has made for her career have left her very much alone. Forced to reexamine the rules of the cutthroat world she has always loved she finds herself in a fight for her very survival.
Vhikai Mupudzi : Couldn't rent, so bought it on Google play, cant wait to watch it 2nyte...
Anton Novo : Is there anything left of the movie that wasnt shown here?..
mariano torres romero : Wow, he fell really into greed after losing all of Herod's gold
Cosmic Barrilet : seems boring... i ve seen The Big short, and Margin Call....those are really interesting
Ruti Tigre : Péssimo filme ainda bem que adiantei algumas partes,pra não perder tanto tempo com essa bobagem.
Keita Foxy : This movie.. is good. Period.
scottab140 : Ethics of Sexuality in the Workplace.
Swan1471 : Worst Wall Street movie I've ever seen, if anything I got from it is don't trust women in wall street.
bademoxy : GEE, I thought she was just going to create her OWN company WITHOUT men, too bad that doesn't happen, it's generally about forcing men within their own companies which these men built to make room for women.
for once ,maybe there can be an all female company to prove they can compete in the marketplace against an all male company.
Traders Friend : Wow, looks like it's a must see. Sorry I'm just learning of it!

Equity and Equality

"Equity and Equality," part of the University of Maine's Rising Tide Center and its 5-Minute Professional Development Series: The Current.
GamernautX : fuck equality, makes everything worse
Emma Franzén : On the 7th of Octoer The Public Health Agency of Sweden and the Swedish Environmental Protection Agency jointly will keep a digital event broadcasting the 2020 ERA-ENVHEALTH Open Conference – Multiple exposures and equity in environmental health. The conference will provide an arena for knowledge exchange between academia and the public sector, and aims to develop and promote national and international collaboration in environmental health. We will discuss how to address exposures to several environmental factors that affect health and wellbeing in an integrated way, both from a policy and a research perspective.

One of our four main topics for the conference will Integrating equity in environmental health. As a introduction to this topic we wish to show your video, and hope for your permission to show it in this context. The conference will be broadcasted through our youtube channel - https://www.youtube.com/channel/UCQFL1Ag69yNLvR-ULHQKbTg.

Kind regards,

Emma
Dean Turner : Nek minute we have full blown communism and social apocalypse
Just a random dude : But the world is not fair
shahad chasib : If you want to know what EQUITY is
watch this link in ARABIC

neilorourke71 : This is great. Now lets go and volunteer at a food bank or a homeless shelter to help those less fortunate! ...Oh, you don't want to do that? ....You want the government to force OTHER people to do it? ...Oh no... This isn't going as planned...
Gaspard McKiterick : It was a great video I loved it
P G : this video is good to understand the general concept, however it simplifies it way to much, doesn't show the complexity of equity in real world circumstances, and there is a lack of constructive criticism to both concepts. When people reach the same point (wealth, food,etc.) no matter how hard or little they work, and any extra would get taken away, why even work hard in the first place?
Who will produce all the food, things ,etc and why should they?

Equity would most probably lead to a decrease in human advancement because hard work wouldn't be rewarded at all.
lemons : The problem with this video is that it completely negates the concept of personal choice. To use the analogy about shoes in the clip. For the most equal outcome, Let everyone choose the shoe that fits them best. This film was over simplified in the worst way.
Cynthia Higgins : I like this video for a presentation I am creating for teachers. I'd like your permission to use in the presentation. Thanks

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#equity

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