Leverage is an amoral concept. On the good side, it can amplify the returns and free up the resources for other purposes. For example, if you have low-risk investment opportunities, you don’t have to keep all the funds in one account with access to leverage.
Yet, if abused, leverage can destroy wealth quickly. One of the most recent examples is Archegos Capital Management that collapsed earlier this year. Due to leverage that reached 8:1 for some positions, a mere sector correction erased over $20 billion in value.