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Kiplinger
Kiplinger
Business
Stephen P. Harbeck

Financial Leverage, Part Two: Don't Say We Didn't Warn You

Tesla Inc. Ford
A larger ball is up in the air on a scale, while the smaller ball is down.

In December, Kiplinger.com published my article about the risks and rewards of investing in highly leveraged cryptocurrency-related securities, What to Know About Leverage and Bitcoin’s Meteoric Rise. Recent events affirm the importance of the primary lesson in that article.

That lesson is: With any financial investment — not just crypto — financial leverage can magnify gains, but it can also magnify and accelerate losses.

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