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Optimum Leverage Ratio |
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Optimum Leverage RatioThe borrowing level that maximizes the value of the firm. The cost of capital to the firm is minimized at that same level.Optimum Leverage Ratio Similar MatchesFinancial leverageFinancial leverageUse of debt to increase the expected return on equity. Financial leverage is measured by the ratio of debt to debt plus equity. Unleveraged betaUnleveraged betaThe beta of an unleveraged required return (i.e., no debt) on an investment when the investment is financed entirely by equity. LeverageLeverageTo derive additional benefits from existing resources. Leveraged equityLeveraged equityStock in a firm that relies on financial leverage. Holders of leveraged equity experience the benefits and costs of using debt. Leveraged investment companyLeveraged investment companyAn investment company or mutual fund entitled to borrow capital for its operations. Also, an investment company that issues both income shares and capital shares. Further SuggestionsHomemade leverageLeveraged stock Leveraged recapitalization Reverse leverage Leveraged company leverage on a warrant Financial leverage clientele leveraged buyout Leveraged lease Leverage clientele Operating leverage leverage Target Leverage Ratio Debt leverage Unleveraged program Highly leveraged transaction (HLT) Leveraged required return Leverage Net benefit to leverage factor Unleveraged required return Reverse leveraged buyout reverse leverage |
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