Gearing

Gearing refers to the relationship between the company’s debt to equity. It is expressed in a ratio. It shows the extent to which lenders versus shareholders fund the firm’s operations. It measures financial leverage in a nutshell. When the debt-to-equity ratio is great, the business may be highly geared or highly leveraged. Financial gearing This […]

Definition: Leverage refers to increased means of accomplishing the purpose of the company. In the financial world, leverage refers to using fixed-cost assets or funds to increase the return to its shareholders. The leverage related to investment activities is called operating leverage. Operating leverage: Operating leverage is caused by to nature of fixed costs incurred