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Leverage

Leverage defined: Leverage is the use of various financial instruments or borrowed capital, such as margin, to increase the potential return of an investment. Leverage is the amount of debt used to finance a firm’s assets. A firm with significantly more debt than equity is considered to be highly leveraged. Leverage is most commonly used in real estate transactions through the use of mortgages to purchase a home.

Above is a definition for “Leverage” from PrivCo’s Private Company Knowledge Bank, the definitive online and e-book guide to private companies and private company deals.

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