Equity in the share market refers to the value of an investors stake in a company, represented by the value of shares they own. It is also known as shareholders equity or owners equity for privately held companies. Equity can be found on a companys balance sheet and is one of the most common pieces of data employed by analysts to assess a companys financial health. It is calculated by taking a companys total assets and subtracting its total liabilities. Equity can be used to value a company and understand if it is overvalued or undervalued in the market.

Equity investors purchase shares of a company with the expectation that they will rise in value in the form of capital gains and/or generate capital dividends. If the investment rises in value, the investor would receive the monetary difference if they sold their shares, or if the companys assets are liquidated and all its obligations are met. Equities can strengthen a portfolios asset allocation by adding diversification.

There are different types of equity, including shareholder equity, which is the ownership of a small piece of the company by an investor. Equity can also refer to the shared ownership of a company through stock and profit sharing.

In summary, equity in the share market refers to the value of an investors stake in a company, represented by the value of shares they own. It is an important concept in finance that is used to assess a companys financial health and value. Equity investors purchase shares of a company with the expectation of capital gains and/or capital dividends.