What Is A Good Roi
ROI means return on investment. Everyone invests money so they get a return on it. What exactly is a return on investment, or an ROI? A return is actually getting back smaller portions of the money that you have invested as an incentive. |
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It is not a profit. It does not come from the invested money. It is a separate entity, which you are getting in the form of money for having invested. A dividend is a typical form of ROI.
You can use the following formula to calculate the ROI.
When you calculate the ROI using this formula, you will get some type of value. Looking at that value, you can decide whether it is good or not. When you invest you will be getting some kind of gains. These gains can be distributed periodically by the company you have invested in or in a bulk amount. This is something you need to take a note of. Calculate how much you have gained for one year through the investment. Now calculate the amount of investment. Well there is nothing really to calculate because most of the time you will know how much you have invested. However, if you have been investing periodically, then you need to calculate the total amount. Now deduct the gains from the amount of investment. When you get the total figure divide that again by the cost of the investment. This should tell you the ROI.
In simple terms, a good ROI is the amount you get when you divide the benefit of an investment by the cost of the investment and the byproduct is of a greater value.
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What Is A Good Roi
