The process of borrowing money to fund a project and boost its potential profits is known as leverage. The leveraged approach is used by several businesses and customers to accomplish objectives.
While businesses use leverage trades to finance assets with debt financing to invest in multiple significant activities and raise equity valuations, investors use leverage trades to increase their profits through options, margin, or future accounts.
The ratio between the amount invested and the amount permitted to trade after taking on debt is known as leverage in trading.