Leverage is an investment technique in which you use a small amount of your money to make an investment of much larger value. Leveraged finance is funding a company or business unit with more debt than generally employed in similar companies and industry. More than normal debt implies that the funding is riskier and more costly. Such companies are called as ‘highly leveraged’. Leveraged finance is generally employed for acquisition, repurchasing shares, or investing in a self-sustaining cash-generating asset.