Bitcoin has become a significant part of the investment as it provides an alternative to the traditional market and serves as a better and broader profile. Since its introduction in 2009, BTC has been ruling the market and significantly impacting it. Data shows that billions of investments in all these years will grow in the future, especially with the world marching toward a digitalized life. While investors who have been in the market for years are well-versed in the concept, beginners might need help understanding the fundamentals. However, with tons of data available, it is easier to understand market trends and concepts. Take a quick read with BitQS to better understand market trends and predictions once you get your ROI. ROI is a fundamental concept that you must be aware of before entering the market.
What is ROI?
Investments in BTC bring dramatic profits, which is the most significant drawing factor for investors to join the market. Investors with massive amounts find it easy to invest in different fields and profiles but consider the profit-calculating aspect a job for the CAs or professionals. However, today’s world has become more competent, and nobody wants to seek professional help for minor reasons. Calculating profit is a no-brainer job, especially if you get a hold of the concept of ROI. A quick read will make the system simpler for you as it does not involve technical complexities.
ROI stands for returns on investment, and it is a metric used to keep track of profits most efficiently. Every time you invest Money in any market, the only goal is to earn profits as much as you can. A simple answer for calculating the profits is by getting your ROI. Investors use it across all profiles to understand whether their investments are profitable. Many call ROI “a quick and dirty method” as it has made complex calculations easy and can be done within minutes. While you might need a professional to handle your accounts, it is time you understand the concept of calculating profits independently. Complexities of formulas can be daunting, but owing to the great work of economists, you need a simple formula to get the ROI of huge investments as well.
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How to calculate ROI?
Mathematics sounds tedious, but even haters find it amusing when it comes to Money. To calculate your ROI, you have to deduct the original value of your invested Money from the present investment value and then divide it by the original value of an investment. This gives you the exact amount that you have earned or made a profit of. If this sounds complicated, then there is a defined formula that you can use, and it goes
ROI = (Present Value of Investment – Initial value of investment) / Initial Value of Investment.
Now, the question arises about understanding the profit margin through this. You can refer to this-
For instance, if you have invested $100 and received $130 as a return, then you have earned a $30% profit from your investment.
Alternative Methods to Calculate ROI
If you find the above formula daunting, then keep breathing. Other ways can help you.
- ROI = Money you Gained – Money you spent / Total Cost of Investment.
- ROI = Investment Net Income (which is the same Money you gained – Money you spent) / Total Cost of Investment
- ROI on Excel sheet– Open your Excel sheet and create the following columns- transaction date, the price at the time you purchased, the amount you paid, and several coins you got. Now, once you have calculated the last two, feed in the current price of the crypto, and you can find it using the formula available online. Then, the job is done, and you know your ROI. This is the most efficient way to calculate ROI, as it also ensures that you have all your data and information stored precisely for future needs.
If you still find ROI daunting, then there are several applications and software out there to help you out. ROI is crucial to understand whether or not your market strategies are working, and therefore you need to have a solid calculating system. Investors use different methods to get ROI, and you can pick what works with your level of investment.
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