The initial value of an investment does not always have a clearly defined monetary value, but for purposes of measuring ROI, the initial value must be clearly stated -- along with the rationale for this initial value.
The final value of an investment also does not always have a clearly defined monetary value, but for purposes of measuring ROI, the final value must be clearly stated -- along with the rationale for this final value.
ROI or Return on Investment Refers to the Profit or Loss Incurred on the Amount of Money Invested in a Business
ROI is also known as rate of profit. Return can also refer to the monetary amount of gain or loss. ROI is the return on a past or current investment, or the estimated return on a future investment. ROI is usually given as a percent rather than decimal value.
ROI does not indicate how long an investment is held. However, ROI is most often stated as an annual or annualized rate of return, and it is most often stated for a calendar or fiscal year. In this article, “ROI” indicates an annual or annualized rate of return, unless otherwise noted.