What it is:
Junior equity is an issuance of stock issued by a company.that is to other
How it works (Example):
Why it Matters:
Owners of senior equity get their hands on leftover before others in the event of bankruptcy. Accordingly, owners of junior equity (those further down in the pecking order) are more likely to get stiffed. That is, the more an owner or is, the weaker its claim on the company's assets. This is why the more junior the equity is, the higher the return investors demand.