Avoiding LICE: The Right and Wrong Ways to Use Leverage in Long-Term Investing

by Return Stacked® Portfolio Solutions | Mar 13, 2025 | Behavioural Drag, Education, Leverage, Return Stacking

This article explores the difference between reckless and defensive leverage, highlighting how excessive leverage combined with illiquidity, concentration, or overuse (LICE) can lead to financial ruin, while strategic leverage can enhance diversification, improve capital efficiency, and manage risk.