DEFINITION of 'Equity Curve'
A graphical representation of the change in value of a trading account over a time period. An equity curve with a consistently positive slope would generally indicate that the trading strategies of the account are profitable, while a negative slope would indicate that the account is in the red.
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BREAKING DOWN 'Equity Curve'
Since it presents performance data in graphical form, an equity curve is ideal for providing a quick analysis of how a strategy has performed. Also, multiple equity curves can be used to assess various trading strategies in terms of performance and risk.
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RELATED FAQS

How can the yield curve help me make investment decisions?
Learn about the yield curve, and discover why this chart is an important economic indicator. How do Treasury bond yields ... Read Answer >> 
Why are the term structure of interest rates indicative of future interest rates?
Learn why economists believe the term structure for interest rates reflects investor expectations for future interest rates ... Read Answer >> 
What is the difference between term structure and a yield curve?
Understand the difference between the term structure of interest rates and a yield curve, if any. Learn what the yield curve ... Read Answer >> 
Where on the Internet can I find yield curves over various periods?
Find out where to locate reliable yield curve information on the Internet, including the U.S. Department of the Treasury ... Read Answer >> 
What does the yield curve actually predict?
Find out what an inverted yield curve represents, how it has performed as a leading indicator and why it appears to hold ... Read Answer >> 
What is the current yield curve and why is it important?
Understand what the current yield curve represents, and learn how market analysts commonly interpret various changes in the ... Read Answer >>