What is Return on Investment (ROI)? // The Motley Fool Australia
Cost of Investment The ratio is multiplied by 100, making it a percent. This way, you are able to see what percentage of investment has been gained back after a period of time. The “Current Value of Investment” is simply the revenue from the sale of the investment. As an example, an investor purchases property A, which is valued at $500,000. A year later, the investor sells the property for $700,000. So the ROI formula, in this case, would be: ROI = (700,000 – 500,000) / (500,000) = 40% Understanding Return on Investment (ROI...
Source: fool.com.au