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Equity is the value of an asset after subtracting any debts owed on it. It represents your ownership stake.
In Depth
In simple terms, equity is what you truly own in an asset. For a home, it's the market value minus your mortgage balance. For a company, it's the value of the company's assets minus its liabilities. As you pay down debt or an asset's value increases, your equity grows. It's a key measure of wealth.
Example
If your home is worth $300,000 and you owe $100,000 on your mortgage, you have $200,000 in home equity.