|visits||member for||1 year, 1 month|
|seen||Nov 8 at 11:56|
Why use leverage when it does not improve the risk/reward ratio?
The premise of your question is flawed. The ratio of risk/reward is invariant to leverage only when you define reward as arithmetic mean return. But your end-of-period capital is the geometric mean of returns. After you reflect on that for a moment, read up on the kelly criterion and you'll learn that there is in theory an "optimal" level of leverage for any investment with a + expected return.