How to calculate ROI from an investment?



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By investing Rs.1 lac in a security today, the maturity proceeds after 10 years will be Rs.2.80 lac. What return is expected from the security over the period of investment?

How should it be calculated?

2 Answer(s)


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The return on this security is 180% and is calculauted as (2.8lac - 1lac)/ 1 lac.

The annualized return is 11% and is calculated as ((2.8lac/1lac)^(365/3650))-1
the 3650 is for the 10 years - 365 days x 10 years.

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Hi. Apart from the formula, you can use the in-built function "RATE" in the Excel. Feed the values as Nper = 10, Pmt = 0, PV = -100000, FV = 280000 and type = 0 or blank. You'll get 10.84% or 11%.