© 2015 Shmoop University, Inc. All rights reserved.

Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Return On Investment (ROI)


The money you gain or lose on your investments over a specific period of time. For example, if you own a stock, you look at your returns on investment over a period of two years, and you may find that you have gains of $1,000. Is that good? Bad? Depends on what you are expecting from your returns and what other investors have seen on their returns.


Put in a dollar. You expect to get more than a dollar back. If you invested a dollar and 3 years later you got back $3, your ROI was 300%. You made $2 in profits. But it's still written nomenclature as a return of 300%. If you invested $3 and 3 years later got back just $1, your return was negative 67%.