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Equity ratio - key figures simply explained

The equity ratio describes the share of equity in the total capital (equity + debt) of a company.
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Definition: equity ratio

The equity ratio describes the share of equity in the total capital (equity + debt) of a company.



Significance for the evaluation

The equity ratio is an indicator of a company's creditworthiness. A high equity ratio reduces the risk of insolvency and, conversely, means lower debt.

Calculation

Equity ratio = (equity / total capital) * 100

Rating

+1 point: equity ratio> 25%
0 points: Equity ratio between 15% and 25%
-1 point: equity ratio <15%

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