What are the key distinctions between ROI and ROIC in the world of cryptocurrency?

1 answers

• May 01, 2022 · 3 years ago
  ROI and ROIC are two important metrics that play a significant role in evaluating investments in the cryptocurrency market. ROI, or Return on Investment, measures the profitability of an investment by comparing the gain or loss relative to the initial investment. It is calculated by dividing the net profit by the initial investment and expressing it as a percentage. ROIC, or Return on Invested Capital, takes into account the capital invested in a project or business and assesses how effectively that capital generates returns. It is calculated by dividing the net operating profit after taxes by the invested capital. While ROI focuses on the return relative to the initial investment, ROIC provides a more comprehensive view by considering the capital employed. In the world of cryptocurrency, ROI is commonly used to evaluate the profitability of individual trades or investments, while ROIC is often used to measure the overall efficiency of a cryptocurrency project or business.
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