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Leverage vs Equity - What's the difference?

leverage | equity |

As nouns the difference between leverage and equity

is that leverage is a force compounded by means of a lever rotating around a pivot; see torque while equity is ownership, especially in terms of net monetary value of some business.

As a verb leverage

is to use; to exploit; to take full advantage (of something).

leverage

English

Noun

(en-noun)
  • A force compounded by means of a lever rotating around a pivot; see torque.
  • A crowbar uses leverage to pry nails out of wood.
  • By extension, any influence which is compounded or used to gain an advantage.
  • Try using competitors’ prices for leverage in the negotiation.
  • (finance) The use of borrowed funds with a contractually determined return to increase the ability of a business to invest and earn an expected higher return, but usually at high risk.
  • Leverage is great until something goes wrong with your investments and you still have to pay your debts.
  • *
  • (business) The ability to earn very high returns when operating at high capacity utilization of a facility.
  • Their variable-cost-reducing investments have dramatically increased their leverage .
  • * {{quote-news
  • , year=2011 , date=April 15 , author=Saj Chowdhury , title=Norwich 2 - 1 Nott'm Forest , work=BBC Sport citation , page= , passage=The former Forest man, who passed a late fitness test, appeared to use Guy Moussi for leverage before nodding in David Fox's free-kick at the far post - his 22nd goal of the season.}}

    Synonyms

    * (force compounded by a lever) mechanical advantage * (use of borrowed fund) financial leverage * (ability to earn high returns from high capacity utilization) operating leverage

    Verb

    (leverag)
  • (transitive, chiefly, US, slang, business) To use; to exploit; to take full advantage (of something).
  • Derived terms

    * leveraged buyout

    Synonyms

    * (take full advantage of) exploit, use

    equity

    English

    (wikipedia equity)

    Alternative forms

    * (archaic)

    Noun

  • value of some business.
  • * {{quote-magazine, date=2013-06-22, volume=407, issue=8841, page=70, magazine=(The Economist)
  • , title= Engineers of a different kind , passage=Private-equity nabobs bristle at being dubbed mere financiers. Piling debt onto companies’ balance-sheets is only a small part of what leveraged buy-outs are about, they insist. Improving the workings of the businesses they take over is just as core to their calling, if not more so. Much of their pleading is public-relations bluster.}}
  • (legal) A legal that deals with remedies other than (l) relief, such as injunctions, divorces and similar actions.
  • * Macaulay
  • Equity had been gradually shaping itself into a refined science which no human faculties could master without long and intense application.
  • (legal) of property minus liens or other (l).
  • (legal) An equitable claim; an equity of redemption.
  • an equity''' to a settlement, or wife's '''equity , etc.
  • * Kent
  • I consider the wife's equity to be too well settled to be shaken.
  • (accounting) Ownership interest in a company as determined by subtracting liabilities from (l).
  • Justice, impartiality or fairness.
  • * Tillotson
  • Christianity secures both the private interests of men and the public peace, enforcing all justice and equity .

    References

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