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what is my ROI?

Posted on 7/11/17 at 7:42 pm
Posted by Rust Cohle
Baton rouge
Member since Mar 2014
1944 posts
Posted on 7/11/17 at 7:42 pm
what are my ROI each year and all together?

12k investment returns 22680 after 5 years
1st year returns 5736k
2nd-5th year 4236k

I have 47% year 1
35% year 2-5

some calculators say its a 189% overall return divided by 5 years is 37% ROI per year

COC calculator

but when I look at it on other calculators for 5 years, its 13.5% ROI. 12k to 22680 is a 13.5% annual return.

when I do it backwards and use a compounding interest calc. 22680 is a 13.5% growth from 12k over 5 years.

ROI calc

of the 2 calculators, when not factoring in time, one says 12k-22680 is 76% and the other is 176%

Its like one doesn't take into account the starting amount and only the growth.



This post was edited on 7/11/17 at 8:07 pm
Posted by PhiTiger1764
Lurker since Aug 2003
Member since Oct 2009
13858 posts
Posted on 7/11/17 at 8:34 pm to
13.6% annualized
89% overall

I don't feel like splitting it up by year. Time is a flat circle.
Posted by John McClane
Member since Apr 2010
36691 posts
Posted on 7/11/17 at 8:39 pm to
Amazing reply
Posted by Rust Cohle
Baton rouge
Member since Mar 2014
1944 posts
Posted on 7/11/17 at 8:39 pm to
I just don't get what is happening. if I making 35% on the final years, why is it overall only 13.5%

I just want to make sure my money is working well for me.
This post was edited on 7/11/17 at 8:41 pm
Posted by gpburdell
ATL
Member since Jun 2015
1422 posts
Posted on 7/11/17 at 10:06 pm to
The original post is a bit confusing. It says 12k investment returns 22680 after 5 years. So is the total investment now 22680 or 34680? Based on your yearly returns it would be the latter. I think most of the calculators would want the latter value of the entire investment and not just the gain.

Assuming 34680, your total return is 189%. For your annualized return, it is 23.6%. This assumes you have not added/withdrawn funds during that time.

Also, you aren't making 35% in your final years. Here is what your balance/yearly return looks like

Year 0: 12000
Year 1: 17736 (47.8%)
Year 2: 21972 (23.9%)
Year 3: 26208 (19.2%)
Year 4: 30444 (16.2%)
Year 5: 34680 (13.9%)
This post was edited on 7/11/17 at 10:35 pm
Posted by HailToTheChiz
Back in Auburn
Member since Aug 2010
48945 posts
Posted on 7/11/17 at 10:15 pm to
This thread reminds me how much I hate math.
Posted by lynxcat
Member since Jan 2008
24147 posts
Posted on 7/11/17 at 10:27 pm to
Wrong board then.
Posted by Rust Cohle
Baton rouge
Member since Mar 2014
1944 posts
Posted on 7/12/17 at 7:12 am to
The total value is 22680 not 34. So I guess I'm in the hole till 2.5 years. 5736 is a -52% of 12k. But I don't think that's an accurate representation of my money.

I am supplying a product for a five-year contract. If the contract is fullfield they get to keep all the product. If it is terminated before, I get to keep the product.

So it is growth plus original until the last year where it's the growth only.
This post was edited on 7/12/17 at 7:28 am
Posted by Rust Cohle
Baton rouge
Member since Mar 2014
1944 posts
Posted on 7/12/17 at 1:25 pm to
Return on investment decreases over time because the money that is made is added to the current value. And when the current value increases, but income does not, the difference becomes greater. ROI will decrease.
Posted by Fat Bastard
coach, investor, gambler
Member since Mar 2009
72628 posts
Posted on 7/14/17 at 7:25 pm to
About tree fiddy.
Posted by Fat Bastard
coach, investor, gambler
Member since Mar 2009
72628 posts
Posted on 7/14/17 at 7:26 pm to
Wait you don't like meth? As in crystal meth??
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