ROI

byPaytm Editorial TeamOctober 16, 2025

Meaning

Understand how to measure the effectiveness of your investments.

Definition

ROI, or Return on Investment, is a key performance metric. It evaluates the efficiency or profitability of an investment by measuring the return relative to its cost.

Calculation

Calculated as: (Net Profit – Cost of Investment) / Cost of Investment x 100%. A higher percentage means better returns.

Significance

ROI helps assess investment performance, compare options, and guide informed financial decisions. It’s vital for business and personal finance.

Author

Paytm Editorial Team

The Paytm Editorial Team is a collaborative group of writers, editors, and industry experts. We're dedicated to bringing you the latest insights, news, and guides on digital payments, financial services, and the technology that's shaping India's economy. We offer easy-to-follow guides and insights to help you explore Paytm’s products, features, and services. Our goal is to provide clear, reliable, and helpful information to empower you on your financial journey.

ROI