Measures a company's financial leverage by comparing its total debt to its shareholders' equity. It is calculated by dividing total debt by total equity. This ratio indicates how much debt is used to finance the company’s assets relative to equity. A higher ratio suggests more debt relative to equity, which can be risky​ (Wall Street Prep)​​ (Corporate Finance Institute)​​ (Wealthsimple: Your money’s worth more.)​​ (Shopify)​​ (InvestingAnswers)​.