What Is Return on Investment ROI In Cryptocurrencies?
Wondering how to calculate your return on Investment?,then “What Is Return on Investment ROI In Cryptocurrencies?”, is for you.
Return on Investment, or ROI for short, is a ratio or percentage value that reflects the profitability or efficiency of a certain trade or investment. It is a simple-to-use tool that can generate an absolute ratio (e.g., 0.35) or a value in percentage (e.g., 35%). As such, ROI can also be used when comparing different types of investments or multiple trading operations.
Specifically, ROI evaluates the return on an investment in relation to its purchasing cost. This means that the calculation of ROI is simply the return (net profit) divided by the total acquisition costs (net cost). The result may then be multiplied by 100 to get the percentage value.
Naturally, a high ROI value indicates that the investment was profitable, while a negative ROI means the return was lower than the costs. The calculation of ROI is based on the following equation:
ROI = (Current Value – Total Cost) / Total Cost
Alternatively, it may also be written as:
ROI = Net Profit / Net Cost
This means that in some situations, one investment may seem more profitable than the other when, in reality, its efficiency was lower because it required a much longer period. So, if Alice’s first trade had a 90% ROI but took 12 months to happen, it would be less efficient than a second trade that had, for example, a 70% ROI in 6 months.
Return on Investment, or ROI for short, is a ratio or percentage value that reflects the profitability or efficiency of a certain trade or investment. It is a simple-to-use tool that can generate an absolute ratio (e.g., 0.35) or a value in percentage (e.g., 35%). As such, ROI can also be used when comparing different types of investments or multiple trading operations.
Specifically, ROI evaluates the return on an investment in relation to its purchasing cost. This means that the calculation of ROI is simply the return (net profit) divided by the total acquisition costs (net cost). The result may then be multiplied by 100 to get the percentage value.
Naturally, a high ROI value indicates that the investment was profitable, while a negative ROI means the return was lower than the costs. The calculation of ROI is based on the following equation:
ROI = (Current Value – Total Cost) / Total Cost
Alternatively, it may also be written as:
ROI = Net Profit / Net Cost
This means that in some situations, one investment may seem more profitable than the other when, in reality, its efficiency was lower because it required a much longer period. So, if Alice’s first trade had a 90% ROI but took 12 months to happen, it would be less efficient than a second trade that had, for example, a 70% ROI in 6 months.
Common Cryptocurrency Scams on Mobile Devices
Ultimate Guide to Symmetric versus Asymmetric Encryption
How Blockchain Is Used in The Internet of Things (IoT)
Ultimate Guide to Understanding What Makes a Blockchain Secure
Upto Date Blockchain Use Cases
Initial Coin Offering List – Comprehensive List of Projects Currently Doing ICO
Ultimate Guide to Initial Coin Offering (ICO)
Ultimate Guide to Understanding What Fractional Reserve is
Understanding Why Public WiFi Is Insecure
The Ultimate History of Cryptography
Understanding what DoS Attack is
Ultimate Guide to what Fiat Currency is
Ultimate Guide to zk-SNARKs and zk-STARKs
Things to Avoid When Using Binance Chain
How Blockchain Is Used In Charity
How Blockchain is Used in Supply Chain
Ultimate Guide to What a Replay Attack is
Ultimate Guide to Delegated Proof of Stake
Ultimate Guide to what Ransomware is
Ultimate Guide to understanding Cryptojacking
Ultimate Guide to Understanding Inflation for Beginners
How to Know Cryptocurrencies Pyramid and Ponzi Schemes
Ultimate Beginner’s Guide to Bitcoin’s Lightning Network
Advantages and Disadvantages Of Blockchain
Ultimate Guide to Ethereum Plasma
Leave a Reply