
What does leverage mean in finance? Generally, the word leverage refers to an investment strategy of specifically borrowed money for various financial instruments such as lending to increase the potential return of an investment by a shareholder. In other cases, the term leverage can also be used to define the amount of debt used by a firm to finance the purchase of various assets. This concept of leverage has used both companies and investors to significantly increase investment returns while reducing the downside risks in case of a loss, thus ensuring that the business does not pan out. The investors…