Leverage
Also written debt to equity.
Definition
For a BDC, debt divided by net assets. The legal limit for most BDCs is 2.0 times; most run between 1.0 and 1.25 times. Higher leverage magnifies both income and credit losses. The Leverage Headroom calculator measures the room left.
Definitions describe how YieldDesk reads the term. Nothing on this page is investment advice or a recommendation to buy, sell or hold.