### Question
How is the "highly leveraged" defined?


### Answer
The term **highly leveraged** is defined in *17 CFR § 1.3* as follows -

> the existence of a ratio of an entity's total liabilities to equity in excess of 12 to 1 as measured at the close of business on the last business day of the applicable fiscal quarter. 

#### Citation:
  - *17 CFR § 1.3*
  - Heading: **PART 1—GENERAL REGULATIONS UNDER THE COMMODITY EXCHANGE ACT**

