Return on investment (ROI) measures the profitability of an investment. ROI compares the amount invested to the amount earned to determine the efficacy of an investment. A positive ROI value indicates that the investment or trade was profitable, whereas a negative ROI indicates that the business was unfavourable to the investor.

This performance metric is widely used to evaluate stocks, cryptocurrencies, real estate, and virtually any other type of business due to its simplicity and efficiency. ROI specifically measures the profit on a specific investment in comparison to its cost. The value of ROI can be calculated by dividing an investment's profit by its cost. It can be expressed as a percentage or as a ratio.