4 million represents a 40 per cent increase in the value of the common stock, whereas the total assets of the company increased only 20 per cent. Leverage is a matter of degree. It has its good side, but is a two-edged sword in a money corporation. Hence, it has been frowned on in banks and insurance companies, whose assets consist largely of securities. Leverage can be drawn so thin that the common stock soars like a fast plane and also plummets in a falling market. There are, moreover, both simple and complex versions of leverage.

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