Return on Investment (ROI)
Formula:ROI = (Gain from Investment - Cost of Investment) / Cost of Investment
Introduction to Return on Investment (ROI) Calculator
Return on Investment (ROI) measures the gain or loss generated on an investment relative to the amount of money invested. ROI is usually expressed as a percentage and is typically used for personal financial decisions, to compare a company's profitability, or to compare the efficiency of different investments.
Parameter usage:
gainFromInvestment
= Total gain from the investmentcostOfInvestment
= Total cost of the investment
Output:
ROI
= Return on investment value
Data validation
Both parameters gainFromInvestment
and costOfInvestment
should be numbers greater than zero.
Summary
This formula helps to evaluate the profitability of an investment. A higher ROI indicates the investment gains compare favorably to its cost.
Tags: Finance, Investment, ROI, Performance