Assets, Liabilities, and Equity - Deepstash
How to Succeed at Investing

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How to Succeed at Investing

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Assets, Liabilities, and Equity

These are the three main components of the balance sheet. Assets are things that have value or generate income for a business. Liabilities are things that cost money or require payment for a business. Equity is the difference between assets and liabilities. It represents the ownership interest or residual value of a business.

Example of these concepts is buying a house. We need to know how to calculate the assets (house), liabilities (mortgage), equity (down payment), etc. of buying a house.

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Income Statement, Balance Sheet, and Cash Flow Statement

Income Statement, Balance Sheet, and Cash Flow Statement

These are the three financial statements that show the performance and health of a business. The income statement shows how much revenue and profit a business makes over a period of time. The balance sheet shows what assets and liabilities a business has at a point in tim...

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Investing

Investing

Investing is putting money into something with the expectation of getting more money back in the future. Investing can be done in various ways, such as buying stocks (shares of ownership in a company), bonds (loans to a government or corporation), or other securities (financial instruments that r...

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Think Like An Owner

Think Like An Owner

Thinking like an owner means having a long-term perspective and caring about the quality and value of what you invest in. Thinking like an owner means doing your own research, analyzing the fundamentals, and making informed decisions based on facts and logic. Thinking like an owner also means bei...

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Diversification

Diversification is spreading your money across different types of investments that have different levels of risk and return. Diversification helps reduce your overall risk by minimizing your exposure to any single investment that may perform poorly or fail. Diversification also helps increase you...

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Brief Summary

Brief Summary

The video covers the basic concepts and principles of finance and investing, such as income statement, balance sheet, cash flow statement, assets, liabilities, equity, return on investment, risk and reward, compounding interest, inflation, valuation, diversification, leverage, hedge funds, etc.

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Return on Investment

Return on Investment

This is one of the most important concepts in investing. It measures how much money you make or lose from an investment relative to how much money you invest. It is usually expressed as a percentage or ratio.

Buying stocks is an example of it. To make most profit, we need to know how to cal...

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Risk and Reward

Risk and Reward

This is another important concept in investing. It describes the trade-off between potential gain and potential loss from an investment. Generally speaking, the higher the risk of an investment, the higher the expected reward of an investment, and vice versa.

The video use sample in buying ...

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In this video, William Ackman, a billionaire investor and founder of Pershing Square Capital Management, explains the basics of finance and investing.

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Understanding equity

Equity has different meanings depending on the context. Shareholder's equity is the most common type of equity - it represents the amount of money that a company's shareholders will get if all of the assets were liquidated and all the debt was paid off.

Equity can be found...

Net Worth = Assets - Liabilities

Net Worth = Assets - Liabilities

Your net worth gives an overview of your financial situation at this point. It is the difference between what you own and what you owe.

Your net worth is positive if your assets exceed your liabilities.

A negative net worth is when your liabilities are greater than your assets....

Calculating your assets and liabilities

Assets are anything of value that you own that can be converted into cash. Examples include:

  • Investments
  • Bank and brokerage accounts
  • Retirement funds
  • Real estate
  • Personal property: vehicles, jewellery and collectables.
  • Cash

Your...

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