Return on Investment (ROI)
Definition
ROI (Return on Investment) is a financial ratio that measures the return on investment in percentage terms and indicates the profit earned against the invested capital.
Return on Investment (ROI) is a financial ratio that measures the return on investment in percentage terms. ROI generally refers to the profit achieved against invested capital. This ratio is calculated by dividing the return on investment by its cost. That is, it is found by the formula (Profit - Investment Cost) / Investment Cost and is usually expressed as a percentage. ROI is used to evaluate the profitability of the investment. A high ROI means that the investment provides a higher return compared to its cost, while a low ROI may indicate that the expected return on the investment is low. Therefore, it is an important performance measure for investors and businesses.
This entry is part of the JrKripto crypto glossary. We explain key terms and concepts to help investors and traders understand the cryptocurrency market. Clear definitions support better decision-making and risk management.
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The JrKripto crypto glossary explains important terms and concepts so investors can understand the market better. Clear definitions support decision-making and risk management. Each entry has a short definition and, where useful, an extended explanation for quick reference or deeper reading.
The glossary covers a wide range of topics from trading and DeFi terms to blockchain infrastructure and market indicators. You can find terms via search or the term list. Use the related terms section to discover related concepts.
