Leverage: Boost or Bust?

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u/FinEducation · Joined Oct 2024

Discover how leverage impacts your results. Use this calculator and visualization to see your gains or losses in bullish, bearish, or stagnant market scenarios.

Last update Oct 2024
  • Scenario 1: Investment Gain (D%)
  • Scenario 2: Investment Loss (E%)
  • Scenario 3: Investment Breaking Even

This chart illustrates how leverage amplifies both gains and losses. In bullish markets, your profits soar, while in bearish conditions, your losses deepen. Explore how different market scenarios influence financial outcomes with leverage.

# Years from Now

Try your numbers:

The amount of your own money you're investing.

A =

The amount you're borrowing to leverage your investment.

B =

The annual interest rate for the borrowed amount.

C =

D =

E =
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  • Amount
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  • Cash Flow
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  • Current Asset
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  • Percentage
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  • Years / Months
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  • Age
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Time Value Assumptions

Heads Up!

If you're using Cost Basis (cb) for calculating capital gains:

Please be aware that very few countries currently use inflation-indexed cost basis. Double-check your local tax rules before publishing.

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How is Cash Value calculated?

In this scenario, your investment grows by D% each year. See how leverage amplifies your gains, turning a steady growth rate into significantly higher returns over time.

Decisions / Expectations

(Expressions are evaluated at Year 0 only.)

F =
G =

Calculations

(Expressions are evaluated at every year.)

H̃ =
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