A stock or any other security representing an ownership interest.
On a company's balance sheet, the amount of the funds contributed by the owners (the stockholders) plus the retained earnings (or losses). Also referred to as "shareholders' equity". In terms of investment strategies, equity (stocks) is one of the principal asset classes. The other two are fixed-income (bonds) and cash/cash-equivalents. These are used in asset allocation planning to structure a desired risk and return profile for a traders’ portfolio. The term's meaning depends very much on the context. In finance, an equity is the ownership of any asset after all debts associated with that asset are paid off. Stocks are equity because they represent ownership in a company.
Typically, equities trading is done through the stock exchanges, such as National Stock Exchange. Stock Exchange has its own particular market makers, which limit volatility (price fluctuations) by purchasing and selling the shares of particular companies on behalf of their clients and themselves.
Equity trading is done electronically, with buying and selling orders matched by computer, by almost every exchange worldwide. Money is made or lost when the spread, or difference, varies from the original price of the security as determined by market makers. Equities trading is a complicated system of generating income used worldwide. Equity traders are highly trained to be experts in their fields. This intricate system of valuing and devaluing securities is one of the financial arteries that speeds growth and development.
Basic specifications are as mentioned below: