Calculating Your Return on Investment (ROI) Episode 46, S4 E1
Manage episode 306156134 series 2936153
You can watch this episode on YouTube.com: https://youtu.be/X8FxSNhlMiY
Determining your ROI is an important part your investment strategy. It helps you differentiate investment opportunities. It's not hard to calculate, but there are some tricks.
1:00 - Returns on Investment - where do I make the most money. This is how you calculate it.
1:23 - A quick example. Say you purchase for $300,000, then sell for $400,000. You make $100,000 profit, right? But that's not ROI, which is always expressed as a percentage. The formula is Profit divided by Cost. (Profit/Cost) = ROI.
2:44 - In our example the ROI is a 33% if it happens in one year, but what if it takes 7 years? Well, the ROI's not so good. 33% / 7 years = 4.7% ROI year over year.
3:38 - It's not just how much money did you make, it's how much money did you make over time?
4:00 - What's the opportunity cost? Calculating ROI can help you determine where to put your dollars.
4:38 - What'd we learn today?
6:12 - Bloopers
* No rates of return were harmed were harmed in the filming on this real estate discussion.
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Aric Wiszt: 801-228-7687
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Jason Christiansen: 801-669-7271
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A Production with Security Home Mortgage's Jason Christiansen, and Hive Collective at Presidio's Tyler Cazier and "Mr. Suit" Aric Wiszt.
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