Management Glossary

  Search Results: leverage
Money borrowed when investing that is used to increase the amount invested and, therefore, the profits from the investment. (Of course, if the investment loses money, leveraging increases the size of the loss, both because more was invested, creating a larger loss, and because interest is due on the loan. In addition, for leveraging to make sense, the expected percentage return on the investment, excluding the loan interest costs, must be greater than the interest rate for the loan.)
Contributed by: ManagerWIse Staff

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