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As a noun, it refers to the concepts of influence, advantage, or mechanical force. As a verb, it means to utilize resources or opportunities to gain an advantage. Its dual functionality makes it highly adaptable in communication. Professional investors and traders take on higher levels of leverage to more efficiently use the money they have to invest. Businesses use leverage to launch new projects, finance the purchase of inventory and expand their operations. Leverage is an unnecessary verb introduced to make statements sound more technical than they are.

Leverage Sentence Examples

Leverage is commonly used to increase shareholder wealth and shareholder equity. If the leverage and debt are too high and the desired result is not met, then the debt’s interest rates and expense can make the company and investors lose more money than they spent. In many cases, leverage is an investment strategy that uses debt to increase high returns, gains, and earnings. Leverage has to do with using debt to increase the buying power and potential gains for company use.

From our Multilingual Translation Dictionary

Before using leverage in your personal life, be sure to weigh the pros and cons. Going into debt can have serious consequences if you can’t afford to repay what you borrow, like damaging your credit or leading to foreclosure. Consortiums allow employers to “leverage” their money and provide services that would be too costly to provide alone. English is the most flexible language I’ve ever heard of but I don’t think that using “leverage” as a verb is (yet) all that popular. Upload your document or paste your text directly into our platform. Your text is reviewed and refined by our expert editors (real people, not machines) who understand the nuances of English.

leverage (sth.) verb (leveraged, leveraged)—

One of the beauties and unique features of the English language is that, sometimes, the same word will have many other uses within different contexts. Overleverage occurs when excessive borrowing leads to financial strain or risk. As a verb, “leverage” means utilizing something, such as skills, knowledge, or tools, to optimize outcomes. An example is, “She leveraged her connections to find a better job.” This is particularly true if you invest funds that aren’t your own. Until you have experience—and can afford to lose money—leverage, at least when it comes to investing, should be reserved for seasoned pros.

More Words with Remarkable Origins

• Professional investors and traders take on higher levels of leverage to more efficiently use the money they have to invest.
• This makes leveraged ETFs a lower risk approach to leveraged investing.
• But I was given a unique and worrying experience of how hackers can leverage insiders when I myself was recently propositioned by a criminal gang.
• The more modern definition of leverage is used in finance and business.
• Leverage can be especially useful for small businesses and startups that may not have a lot of capital or assets.

Expect corrections, improvements, and insightful suggestions that enhance the clarity, tone, and professionalism of your writing. One of the best ways to learn how to use a word is simply by using it every chance that you get. If you’re looking to increase your ability to use this word, try using it in a handful of sentences today! This is a great way to start increasing the number of viable words in your vocabulary and increasing your ability to communicate with clarity and conciseness. Most commonly, this means to use something to its maximum advantage and get the best out of something.

For many businesses, borrowing money can be more advantageous than using equity or selling assets to finance transactions. When a business uses leverage—by issuing bonds or taking out loans—there’s no need to give up ownership stakes in the company, as there is when a company takes on new investors or issues more stock. Leverage can offer investors a powerful tool to increase their returns, although using leverage in investing comes with some big risks, too. Leverage in investing is called buying on margin, and it’s an investing technique that should be used with caution, particularly for inexperienced investors, due its great potential for losses. Leverage is nothing more or less than using borrowed money to invest. Leverage can be used to help finance anything from a home purchase to stock market speculation.

Over time, the term evolved to include metaphorical applications, particularly in business and finance, symbolizing power and strategic influence. The term “leverage” is widely used across different fields, from business and finance to physics and everyday life. Its meanings range from physical applications to strategic influence, making it a versatile and essential word in modern language. Balancing an equity ratio to provide a company with a great deal of leverage can be exciting, but it is also risky, so invest wisely! In most cases, dealing with leverage is an alternative to the stock market that is typically only done by small groups of professional investors to increase the purchasing power of a company by a marginal amount.

• The player’s popularity has given him a great deal of leverage with the owners of the team.
• Leverage means to use something in such a way that a small amount has a big result, much as a lever lets you move a larger load than you would normally be able to.
• Personally I feel that “leverage” is a noun, as defined by Merriam-Webster’s as “the action of a lever or the mechanical advantage gained by it”.

SPANISH AND ENGLISH EXAMPLE SENTENCES

But I was given a unique and worrying experience of how hackers can leverage insiders when I myself was recently propositioned by a criminal gang. Leverage means to use something in such a way that a small amount has a big result, much as a lever lets you move a larger load than you would normally be able to. In terms of the statement, Zend can be made more effective with plug ins. That is to say, the plug in means that your web app gets extra functionality from Zend+plug ins than it would from Zend alone. Sooner or later, you want to leverage Zend_Application better by creating your own resource plugins. Connect and share knowledge within a single location that is structured and easy to search.

For example, depending on the Forex broker a trader uses, they could request orders of 500 times the size of their deposit. That discrepancy between cash and margin can potentially increase losses by huge orders of magnitude, leaving it a strategy best left to very experienced traders. That means if an index rose 1% in a particular day, you might gain 2% or 3%. It’s important to note that on most days, major indexes, like the S&P 500, move less than 1% in either direction, meaning you generally won’t see huge gains or losses with this kind of fund. If the value of your shares fall, your broker may make a margin call and require you to deposit more money or securities into your account to meet its minimum equity requirement. It also may sell shares in your margin account to bring your account back into good standing without notifying you.

Review the changes, make any final adjustments, and confidently share your polished English with the world. You can count on a personalized, friendly service every time you use TextRanch. We’re committed to helping you make a great impression with every word you write. However, many new investors are usually better off staying away from this kind of professional trading simply because of the high risk of investing in leverage. There are two primary definitions in the English dictionary of the word leverage, and they are both nouns. While it may have some more widespread uses, it can also be used in modernized and fresh contexts.

To leverage something you apply it to the other end of a lever in order to multiply its effect. So when I used a pick axe at the weekend to lift a manhole lid, I was levering the lid but leveraging my strength. In corporate finance, leveraging is not just borrowing, but using credit to increase the effect of some existing assets. Certainly (like a lot of Americanisms) really useful when used well.

More from Merriam-Webster on leveraged

While commonly used in formal contexts like business and finance, “leverage” also appears in casual language. In strategic and business contexts, “leverage” refers to the ability to use influence, resources, or advantages to achieve a specific outcome. For instance, “The company leveraged its reputation to secure better deals.” Leverage can be especially useful for small businesses and startups that may not have a lot of capital or assets. By using small business loans or business credit cards, you can finance business operations and get your company off the ground until you start earning profits. When you take out a loan or a line of credit, the interest payments are tax-deductible, making the use of leverage even more beneficial.

Kat has expertise in insurance and student loans, and she holds certifications in student loan and financial education counseling. While leverage leverage verb meaning affords plenty of potential for upside, it can also end up costing you drastically more than you borrow, especially if you aren’t able to keep up with interest payments. Carriers will also have to optimise their fleet strategy and connections to be able to leverage the city’s strategic location advantage between Europe, the US and Asia. It is frequently used in finance to mean that a small amount of money (like a house downpayment) can be used to much greater financial effect, such as buying a house. Relatively small groups can sometimes exert immense political leverage. “This is my first time using TextRanch, and I like how the editors take time to correct my text. To everyone who has never used TextRanch before, I highly recommend trying it.”