what is roi?

ROI stands for "Return on Investment". It is a financial metric used to evaluate the efficiency or profitability of an investment or compare the efficiency of different investments. ROI measures the amount of return on a particular investment, relative to the investments cost. It is calculated by dividing the benefit (or return) of an investment by the cost of the investment and is expressed as a percentage or a ratio. A high ROI means the investment's gains compare favorably to its cost. ROI is used in business to measure rates of return on money invested in an economic entity in order to decide whether or not to undertake an investment. It is also used as an indicator to compare different investments within a portfolio. ROI can be used to make apples-to-apples comparisons and rank investments in different projects or assets. However, ROI does not take into account the holding period or passage of time, and so it can miss opportunity costs of investing elsewhere.