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Asked by sharnell - 2 years ago
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Richard Level 75 / Retired Dentist
Answered 2 years ago
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Rate of return or ROR or ROI is a measure of cash generated by or lost due to the investment. It measures the cash flow or income stream from the investment to the investor, relative to the amount invested. Cash flow to the investor can be in the form of profit, interest, dividends, or capital gain/loss. Capital gain/loss occurs when the market value or resale value of the investment increases or decreases. Cash flow here does not include the return of invested capital.

There are several different ways to figure it depending on circumstances.
See
http://en.wikipedia.org/wiki/Rate_of_ret...

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