Exchange Currency

negative leverage

The situation in which the return on the investment purchased with borrowed money is less than the interest on the money borrowed. This happens when the cost of borrowing money (i.e., the interest payments) is greater than the return on the investment. Also called reverse leverage.

Related information about negative leverage:
  1. What is negative leverage? definition and meaning
    Definition of negative leverage: The situation in which the return on the investment purchased with borrowed money is less than the interest on the money ...
     
  2. Leverage (negotiation) - Wikipedia, the free encyclopedia
    Types of leverage include positive leverage, negative leverage, and normative ... 1 Normative Leverage; 2 Positive Leverage; 3 Negative Leverage; 4 Buyer ...
     
  3. negative or positive leverage financial definition of negative or ...
    leverage, negative or positive. Negative leverage occurs when the cost of borrowing money is greater than the return a party makes on an equity investment.
     
  4. Understanding Financial Leverage and Its Impact on Investors
    Learn how positive leverage, neutral leverage, or negative leverage can impact the yield a real estate investor collects as a result of financial leverage.
     
  5. Real Estate Feasibility Test 2 Flashcards
    Oct 21, 2009 ... Negative leverage occurs when the unlevered IRR is less than the interest rate paid on the debt. Returns and losses are magnified by the ...
     
  6. PDF (837 K) - National Bureau of Economic Research
    be positive when asset prices increase since the negative leverage ratio is applied to a negative initial net worth figure. This is illustrated in the example below.
     
  7. Exploring Leverage and Financing Real Estate
    Oct 11, 2011 ... If the investment's yield is less than your cost of money, you've entered the negative leverage zone. Again, down payment is irrelevant. Now I'll ...
     
  8. Negotiation: Leverage
    Negative leverage: the stick--"Here's the trouble I can cause you." Consistency leverage: "Here's the principle you stand for--now live up to it." To get a sense of ...