1. Leverage refers to stocks purchased by borrowing funds, especially stocks purchased by margin trading. In other words, you have 500,000 principal, 4 times leverage can buy 2.5 million shares, and 2 million is borrowed.

2. In terms of investment, the so-called leverage refers to the use of some funds with fixed interest rates in the capital structure, such as corporate bonds and preferred stocks, to improve the return on investment of common stocks.

3. Agree in advance to pay the interest rate of corporate bonds or dividends paid to preferred stocks. If the profit obtained by the enterprise's operation is higher than this fixed interest rate, after paying the corporate bond interest rate or preferred stock dividend, the residual profit enjoyed by ordinary shareholders will be greatly increased.