Glossary term

Leverage

In plain English

Using borrowed money to make a bigger bet than your own capital allows. Magnifies both gains and losses.

Example

A 10× leveraged position turns a 3% drop into a 30% loss on your capital.

Educational only. TrustFirst is not a registered investment adviser and does not provide personalized investment advice. This definition is written to teach the concept; it is not a recommendation to take any specific action.