Leveraged Beta

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Definition: Leveraged Beta

Leveraged beta is the Beta of a firm having a financial leverage. It reflects the capital structure that includes debt. It changes in positive correlation with the amount of debt a firm has in its financial structure i.e. as firm increases its financial leverage the firm's levered beta increases


The unlevered beta is mostly slightly higher than the leveraged beta. Leveraged beta shows the limited volatility.

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