Leverage is good when used smartly

Leverage attracts people and vice versa. Whenever we want to trade or in any case of acquisition, what we expect is not the mere margin profit, instead we shoot for highly leveraged return. This is primitive emotion of greed. People making fortune at investments are great example. They invest after checking the fundamental and what the balance sheet has to offer and invest. This is not an easy job. They wait for couple of year to compound with a hope of no economic depression and make lot of money. That is huge. Here, like many modern day technological leverages are not available, instead they rely upon the opportunity leverage. The future is full of possibilities and by their analysis they might have found out the future of the organisation is about to explode. These rich people are very keen at predicting the outcome by the current, which now has been one of the toughest job. Because of the exponential curve of growth, predictions are less probable to tryst upon. Yet wen predict a change, but the accuracy cannot be predetermined.

Even time allocating for fundamental analysis became so  relevant because of the uncertainty in behaviour. With more knowledge, we have diversified views and opinions. When masses diverse, the opportunity soars and predictions dries.

Investing in oil in the 70s is not a big deal. Mechanical industries was at its best and transportation was proliferating like a wildfire. There was immense opportunity. Yet some averse the industry and stuck at the everyday loop. But those invested a lot of money. They are still enjoying the late fortune. Now everybody is convinced ( and it is true) about the digital age. Digital industry isn’t just a progression of monomaniacal path, it is very well diversified and made a lot of confusion among baby investors. For the experienced ones, they are either sure or were left the industry. These new investors (including and mainly retail investors) are influenced by the leverage and expecting a moonshot return. With little experience and learning, especially in this highly unpredictable world, this might turn into a foolishness.

  Because focusing on leverage is not about learning to earn, it is about earning to expense. They are playing finance with lack of financial education. Leverage is incentive and inducing, but we have to play it smart