gearing
(redirected from gear)Also found in: Dictionary, Thesaurus, Acronyms, Idioms, Encyclopedia, Wikipedia.
Gearing
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
Leverage Ratio
In risk analysis, any ratio that measures a company's leverage. One example of a gearing ratio is the long-term debt/capitalization ratio, which is calculated by taking the company's long-term debt and dividing it by its long-term debt added to its preferred and common stock. Another example is a simple debt-to-equity ratio, which is calculated by dividing total debt by total equity. Generally, companies with higher leverage as determined by a leverage ratio are thought to be more risky because they have more liabilities and less equity. A leverage ratio is also called a gearing ratio or an equity multiplier.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
gearing
see CAPITAL GEARING.Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson
gearing
see CAPITAL GEARING.Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005