Explore the question in detail with explanation, related questions, and community discussions.
When an investor borrows a large portion of funds from a broker to buy securities, it is known as a leveraged investment. This practice allows traders to control a bigger position with a smaller amount of their own money, often through margin trading. While leverage can increase potential returns, it also magnifies the risk of losses, since borrowed money must be repaid even if the investment performs poorly.
Discussion
Leave a Comment