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return on investment

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Also known as ROI, ROC, return on costs

ratio between the net profit and cost of investment resulting from an investment of some resources

Wikidata facts

Subclass of
financial ratio
Part of
investment
Show 3 more facts
Commons category
Return on investment
short name
ROC
different from
return on capital
Sources (3)

via Wikidata · CC0

~9 min read

Encyclopedic overview

Return on investment (ROI) or return on costs (ROC) is the ratio between net income or profit to investment (costs resulting from an investment of some resources). A high ROI means the investment's gains compare favorably to its cost. As a performance measure, ROI is used to evaluate the efficiency of an investment or to compare the efficiencies of several different investments. In economic terms, it is one way of relating profits to capital invested.

Purpose

Excerpted from Wikipedia’s “return on investment” article, available under the CC BY-SA 4.0 licence.