Operating leverage

Operating leverage can also be measured in terms of change in operating income for a given change in sales (revenue).

Operating Leverage Amount of fixed operating costs.
Opportunity Cost of Capital The expected return that is foregone by investing in a project rather than a financial security with comparable risk.

Operating leverage
Fixed operating costs, which are characterized as leverage because they accentuate variations in profits.

Operating leverage
Operating leverage reflects the extent to which fixed assets and associated fixed costs are utilized in the business. Degree of operating leverage (DOL) may be defined as the percentage of levering.

Degree of operating leverage (DOL) : Percentage change in net operating income for a given percentage change in sales.

operating leverage The percentage of fixed costs in a firm's cost structure. Generally, the higher... operating margin The operating income divided by revenues, expressed as a percentage.

The relationship between interest bearing debt and equity in a company (financial leverage) or the effect of fixed expense on after tax earnings (operating leverage).
LIBOR (London Inter-Bank Offered Rate) ...

Financial leverage magnifies increases in earnings per share during periods of rising operating income but adds significant risks for stockholders and creditors because of added interest obligations. Compare operating leverage.

CBOT's and CME's expenses are mostly fixed costs, meaning that more revenue means substantially more profits. When the two combine forces, they should both feel the benefits of this operating leverage.

See also: Rating, Share, Leverage, Market, Earnings