Finance Glossary
Financial Gearing Definition
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Financial Gearing
A term used to describe the relationship between the Companys debt and equity shareholders funds.
Gearing is usually expressed as a percentage and is calculated by dividing the Companys debt by its equity.
A highly geared company is one where there is a high proportion of debt to equity, and can be considered a risky investment as there is a higher likelihood of the company being unable to pay its large debts.
A term used to describe the relationship between the Companys debt and equity shareholders funds.
Gearing is usually expressed as a percentage and is calculated by dividing the Companys debt by its equity.
A highly geared company is one where there is a high proportion of debt to equity, and can be considered a risky investment as there is a higher likelihood of the company being unable to pay its large debts.
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