ROI Formula

ROI, or Return on Investment, measures how much profit or benefit you gain from an investment relative to its cost. The formula is: ROI = (Net Profit / Cost of Investment) x 100%. It tells you the percentage of return earned on your initial investment. For example, if you invested $1,000 and made $200 profit, your ROI would be 20%. A higher ROI indicates a more profitable investment, helping you compare the efficiency of different projects or investments to make informed decisions.