Comments on: How to calculate your return on investment http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/ Special situation stocks and value investing Tue, 07 Feb 2012 02:35:15 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Lionel http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-556896 Lionel Tue, 17 Jan 2012 18:24:47 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-556896 I come up with the same numbers as Simon, 28% & 3.6%. I'm interested in my Personal Rate of Return. So I don't include the dividend/profits in the calcuation. They are not funds I'm pulling out of the account at the times they're added. On the other hand I am having to pay taxes. (Not sure why those dates aren't more like April 15 however.) So the string of cash flows becomes simply: $100k in, $1k in, and $129k out. I come up with the same numbers as Simon, 28% & 3.6%. I’m interested in my Personal Rate of Return. So I don’t include the dividend/profits in the calcuation. They are not funds I’m pulling out of the account at the times they’re added. On the other hand I am having to pay taxes. (Not sure why those dates aren’t more like April 15 however.)

So the string of cash flows becomes simply: $100k in, $1k in, and $129k out.

]]> By: Sambit http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-520797 Sambit Sat, 29 Oct 2011 11:57:11 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-520797 4. S Limited is considering for purchase of a machine. There are two possible machines which will produce the additional output. Details of these machines are as follows: Machine x Machine Y Rs. Rs. Capital Cost Sales at standard Price Costs: Labour Materials Factory Overheads Administration Cost Selling Costs Expected life in years 60,000 1,00,000 10,000 8,000 12,000 4,000 2,000 2 60,000 80,000 6,000 10,000 10,000 2,000 2,000 3 Other Information: (a) The costs shown above relate to annual expenditure resulting from each machine. Sales are expected to continue at the rates shown for each year for the full life of each machine; (b) Tax to be paid may be assumed at 50% of net earnings; (c) Interest on capital is to be ignored; (d) The appropriate rate of interest for converting to present value may be taken at 10%. On the basis of the facts given above, show the most profitable investment by the following methods. (i) Pay-back Period, (ii) Return on Investment; and (iii) Net Present Value on Investment. 4. S Limited is considering for purchase of a machine. There are two
possible machines which will produce the additional output. Details of these machines are
as follows:

Machine x Machine Y
Rs. Rs.
Capital Cost
Sales at standard Price
Costs:
Labour
Materials
Factory Overheads
Administration Cost
Selling Costs
Expected life in years 60,000
1,00,000

10,000
8,000
12,000
4,000
2,000
2 60,000
80,000

6,000
10,000
10,000
2,000
2,000
3

Other Information:
(a) The costs shown above relate to annual expenditure resulting from each machine. Sales
are expected to continue at the rates shown for each year for the full life of each machine;
(b) Tax to be paid may be assumed at 50% of net earnings;
(c) Interest on capital is to be ignored;
(d) The appropriate rate of interest for converting to present value may be taken at 10%.
On the basis of the facts given above, show the most profitable investment by the following methods.
(i) Pay-back Period,
(ii) Return on Investment; and
(iii) Net Present Value on Investment.

]]> By: ROI vs. GPH - Page 2 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-508958 ROI vs. GPH - Page 2 Fri, 23 Sep 2011 21:44:56 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-508958 [...] tool. The biggest thing is figuring out your ROI properly. Look at steps 1 and 2 on this site: How to calculate your return on investment Step 1. Calculate all the costs associated with an investment. Ask yourself the following [...] [...] tool. The biggest thing is figuring out your ROI properly. Look at steps 1 and 2 on this site: How to calculate your return on investment Step 1. Calculate all the costs associated with an investment. Ask yourself the following [...]

]]> By: aditya http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-507353 aditya Mon, 19 Sep 2011 09:32:23 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-507353 sir can u pls tell me which is the best course as of now if you want to pursue your career in the finance field? sir can u pls tell me which is the best course as of now if you want to pursue your career in the finance field?

]]> By: cherish domingo http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-498550 cherish domingo Mon, 08 Aug 2011 10:50:06 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-498550 xyz corporation sells on terms of 2/10, n/30 70% of custumers normally avail of the discounts annual sales are P900,000 80% of w/c is made on credit. cost approximately 75% of sales. what is the average balance of accounts receivable? and the average investment? xyz corporation sells on terms of 2/10, n/30 70% of custumers normally avail of the discounts annual sales are P900,000 80% of w/c is made on credit. cost approximately 75% of sales. what is the average balance of accounts receivable? and the average investment?

]]> By: anuj http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-485287 anuj Tue, 31 May 2011 09:21:53 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-485287 face value of share rs.50 no. of shares 20, discount rate 5%, dividend received 13.5% p.a. calculate roi face value of share rs.50 no. of shares 20, discount rate 5%, dividend received 13.5% p.a. calculate roi

]]> By: Amartya Ghosh http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-454056 Amartya Ghosh Thu, 30 Sep 2010 19:51:07 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-454056 How can i calculate about the expected return of mutual fund. How can i calculate about the expected return of mutual fund.

]]> By: john http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-453828 john Sat, 24 Jul 2010 16:35:13 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-453828 i need details for costing that are using in FMCG companies i mena how they are doing costing if u have and exmaple kinldy please send to my email address i need details for costing that are using in FMCG companies

i mena how they are doing costing if u have and exmaple kinldy please send to my email address

]]> By: Nalini http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-453818 Nalini Thu, 22 Jul 2010 13:08:16 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-453818 Hello sir, im an Bachelor in Accounting student. Currently im doing a project on share market investment. I want to find how to calculate log return for the investment. Can u tell me how to calculate? This is the question. Thank you. Date High Low Last Volume 2010-06-10 0.670 0.660 0.670 350 Stock Summary Average Price: RM0.68 Average Volume: 800.17 Total Volume: 24,005 **Volume: No of Lots **1 Lot = 100 shares Hello sir, im an Bachelor in Accounting student. Currently im doing a project on share market investment. I want to find how to calculate log return for the investment. Can u tell me how to calculate? This is the question. Thank you.

Date High Low Last Volume
2010-06-10 0.670 0.660 0.670 350

Stock Summary
Average Price: RM0.68
Average Volume: 800.17
Total Volume: 24,005

**Volume: No of Lots
**1 Lot = 100 shares

]]> By: Dennis "DennisKnows" Marshall http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-453784 Dennis "DennisKnows" Marshall Thu, 08 Jul 2010 23:26:58 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-453784 Im in real estate and need to figure out the annual ROI on a property. Im in real estate and need to figure out the annual ROI on a property.

]]> By: sandeep http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-2/#comment-453713 sandeep Mon, 14 Jun 2010 13:15:20 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-453713 sir,i work for an FMCG organisation food stuff, with a wide distribution network , the operational costs for distributors would be thier fuel costs,manpower costs,depreciation on vehicle,etc.,on a daily or monthly basis,i would like to know if i have to calsulate thier ROI would i be taking into account thier fixed costs like ,investment on vehicles and Godown deposists,etc,or just calculate thier monthly rentals , kindly advise , how thier ROI is calculated,Thanks,Regards,Sandeep. sir,i work for an FMCG organisation food stuff, with a wide distribution network , the operational costs for distributors would be thier fuel costs,manpower costs,depreciation on vehicle,etc.,on a daily or monthly basis,i would like to know if i have to calsulate thier ROI would i be taking into account thier fixed costs like ,investment on vehicles and Godown deposists,etc,or just calculate thier monthly rentals , kindly advise , how thier ROI is calculated,Thanks,Regards,Sandeep.

]]> By: Jonah http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-446252 Jonah Tue, 17 Nov 2009 02:32:08 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-446252 Looking for feedback on this spreadsheet I created comparing real estate vs. any interest bearing account. http://www.editgrid.com/user/jonahu/RealEstate_vs_HighYield I was looking for a way to compare the two investment methods strictly from a ROI stand point. I suppose this comparison could also be used to compare real estate vs. stocks by inputting your expected interest rate of return for High Yield Interest Rate. Is this comparison valid/fair or flawed? Thanks. Looking for feedback on this spreadsheet I created comparing real estate vs. any interest bearing account.
http://www.editgrid.com/user/j....._HighYield

I was looking for a way to compare the two investment methods strictly from a ROI stand point.

I suppose this comparison could also be used to compare real estate vs. stocks by inputting your expected interest rate of return for High Yield Interest Rate.

Is this comparison valid/fair or flawed?

Thanks.

]]> By: Invest http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-445055 Invest Sun, 08 Nov 2009 05:59:10 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-445055 thank you for sharing, this made it really easy to understand. thank you for sharing, this made it really easy to understand.

]]> By: Alpha http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-438766 Alpha Tue, 15 Sep 2009 18:34:14 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-438766 Hi I am facing some problem on how to get the required rate of return of a project. Below are the information provided. TJW estimates the covariance between the S&P500 and TJW to be .09. The standard deviation of S&P500 returns is 30% and the standard deviation of TJW returns is 35%. The expected return on the S&P500 is 14% and the risk free rate is 7%. The project is 25% riskier than the firm’s average operations and the firm is 100% equity financed. I have already found the Beta but I am not sure how to adjust this beta according to the additional amount of risk faced by the project. Can anyone help me with this ? Thanks Hi

I am facing some problem on how to get the required rate of return of a project. Below are the information provided.

TJW estimates the covariance between the S&P500 and TJW to be .09. The standard deviation of S&P500 returns is 30% and the standard deviation of TJW returns is 35%. The expected return on the S&P500 is 14% and the risk free rate is 7%. The project is 25% riskier than the firm’s average operations and the firm is 100% equity financed.

I have already found the Beta but I am not sure how to adjust this beta according to the additional amount of risk faced by the project. Can anyone help me with this ? Thanks

]]> By: Calculators...?? - Millionaire Entrepreneur Forum http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-415773 Calculators...?? - Millionaire Entrepreneur Forum Sun, 31 May 2009 17:51:35 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-415773 [...] + roi2 *50/365+.. I guess that should be sufficiently precise. Heres a more detailed explanation: How to calculate your return on investment   [...] [...] + roi2 *50/365+.. I guess that should be sufficiently precise. Heres a more detailed explanation: How to calculate your return on investment   [...]

]]> By: dipti takale http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-393078 dipti takale Mon, 23 Mar 2009 14:16:01 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-393078 I have data from nseindia.com which contain index value suppose for year 2005 starting from 1/1/2005 to 31/12/2005 and i want to calculate log retuns. how will i calculate it? I have data from nseindia.com which contain index value suppose for year 2005 starting from 1/1/2005 to 31/12/2005 and i want to calculate log retuns. how will i calculate it?

]]> By: Aaron http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-372015 Aaron Sat, 17 Jan 2009 23:13:37 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-372015 Outstanding stuff! Anyone know if any brokerage firm provides the annualized rate of return without having to use a spreadsheet? Thanks, Aaron Outstanding stuff! Anyone know if any brokerage firm provides the annualized rate of return without having to use a spreadsheet? Thanks, Aaron

]]> By: Joe http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-361119 Joe Tue, 16 Dec 2008 02:49:39 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-361119 @Rob: My comment (just above yours) answers your question. Only caveat is you need to know the market value of the account on the days of the deposits and withdrawals. Regards. @Rob:
My comment (just above yours) answers your question. Only caveat is you need to know the market value of the account on the days of the deposits and withdrawals.

Regards.

]]> By: rob summerby http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-361080 rob summerby Tue, 16 Dec 2008 00:04:38 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-361080 How do I calculate the avg yearly gain of an investment portfolio over 5 years when there are periodic deposits & withdrawals to the portfolio? Current value =22000 start value=10000 (5 yrs ago) several deposits during the 5 yrs total 5000 several withdrawals during the 5yrs total 2000. thank you. Rob. How do I calculate the avg yearly gain of an investment portfolio over 5 years when there are periodic deposits & withdrawals to the portfolio?

Current value =22000
start value=10000 (5 yrs ago)
several deposits during the 5 yrs total 5000
several withdrawals during the 5yrs total 2000.
thank you.
Rob.

]]> By: Calculating the rate of return on investments: ROI versus IRR - Mind Your Decisions http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/comment-page-1/#comment-347250 Calculating the rate of return on investments: ROI versus IRR - Mind Your Decisions Thu, 13 Nov 2008 07:46:59 +0000 http://www.fatpitchfinancials.com/392/how-to-calculate-your-return-on-investment/#comment-347250 [...] How to calculate your return on investment–a step by step explanation from Fat Pitch Financial on how to get IRR…plus a free spreadsheet [...] [...] How to calculate your return on investment–a step by step explanation from Fat Pitch Financial on how to get IRR…plus a free spreadsheet [...]

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