Average Shareholder Equity
Average shareholder equity is the simple average of the starting shareholder equity value and the ending shareholder equity value of the trading day.
Example
Shareholder’s Equity (beginning figure) | 140,000 |
Shareholder’s Equity (ending figure) | 160,000 |
Average Shareholder’s Equity | (140,000+160,000)/2 = 150,000 |
The above table shows that the shareholder equity at the beggining is 140,000 and the ending figure is 160,000. Therefore, the average shreholder equity is 150,000.