Return on Investment (ROI)

Return on investment (ROI) measures the relationship between investment income or loss and investment amount. ROI is usually expressed as a percentage and is usually used for personal financial decision making, company profitability comparison, or comparison of various investment efficiencies.

The calculation of ROI is very flexible and can be used for various purposes. Companies can use this calculation to compare the ROI of various potential investments and investors can use it to calculate price-earnings ratio.

For example, investors purchase $ 1,000 worth of shares and sell it two years later at a price of $ 1,200. Investment net profit is US $ 200, ROI is calculated as follows.

In the example above the ROI is 20%. In order to more accurately understand the total ROI, you can change the calculation by deducting tax and fee.

You can use the same calculation to calculate company investment. However, calculation is more complicated because there are many inputs. For example, to calculate the net profit of an investment, the company needs to track exactly how much cash is in the project and the time spent by the employee engaged in the project.

Due to its flexibility, ROI is one of the most commonly used profitability. That said, one of the disadvantages of ROI calculation is that it can be manipulated. Therefore, the result varies from user to user. When comparing investment and ROI, it is important to use the same input for an accurate comparison.

Furthermore, it is important to note that taking into consideration the basic ROI calculations takes less time. Clearly, a return of + 15% in one year is better than one year and two years.

Return on investment (ROI) is a measure of the performance used to evaluate investment efficiency and compare the efficiency of various investments. ROI attempts to directly measure the return on a particular investment compared to the investment cost. To calculate the return on investment, divide the ROI (or revenue) by the investment cost. Results are expressed as a percentage or ratio. In the above formula, "investment income" means income from the sale of interest investment. ROI is measured as a percentage so you can easily compare with the return on other investments to measure various investments. Types of investment between each other

The formula for calculating return is the way to calculate ROI. Return On Investment (ROI) Return on investment (ROI) is a measure of performance used to evaluate ROI and compare efficiency between different investments. ROI represents the return on investment to investment cost. Cost (or market value) assigned to denominator and denominator. With respect to shares, the relationship between shareholders' holders of earnings and shareholder 'stakeholders' and' shareholders' is often used interchangeably in the business environment. Cautious research on the meaning of stakeholders and shareholders has a big difference in usage. Usually, shareholders are stakeholders of the company, stakeholders are not necessarily shareholders. The income at the individual level is in the form of dividends. The frequency of dividends varies, but it is usually done quarterly (there may be monthly, semi-annually or yearly).

Return on investment (ROI) measures revenue or loss on investment in investment. ROI is usually expressed as a percentage and is usually used for personal finance decisions, company profitability comparisons, or for comparison of various investment efficiencies. But in order to truly participate in rapidly evolving business and technology areas (Moore's Law is uncontrollable), we need to explore the proximity of Horizon 2 and destructive innovation of Horizon 3 .