What is the impact of leverage on a company's financial position?

Since leverage means paying regular interest payment without any delay it puts an obligation on the company to pay interest no matter what the financial position of the company is and in worst case scenario it can even lead to the bankruptcy of the company.

Do larger equity multipliers mean more financial leverage?

Hence, larger equity multipliers suggest more financial leverage. If reading spreadsheets and conducting fundamental analysis is not your cup of tea, you can purchase mutual funds or exchange-traded funds that use leverage. By using these vehicles, you can delegate the research and investment decisions to experts.

What is margin leverage?

Margin is a special type of leverage that involves using existing cash or securities position as collateral used to increase one's buying power in financial markets.

What are the limitations of leverage?

Another limitation of leverage is that due to leverage company may make decisions which it would not have made if there was leverage. So, for example, a company sitting on cash due to leverage may acquire a loss-making company or purchase assets even when they are not required.