1. What is Monthly ROI?

Monthly ROI (Return on Investment) measures the percentage return generated from an investment each month. It helps investors evaluate the performance and profitability of their investments on a monthly basis.

2. How Does the Calculator Work?

The calculator uses the Monthly ROI formula:

Where:

• \( \text{Monthly Profit} \) — Net profit generated in one month (USD)
• \( \text{Investment} \) — Total amount invested (USD)

Explanation: The formula calculates what percentage of the original investment was returned as profit during the month.

3. Importance of ROI Calculation

Details: Monthly ROI is crucial for tracking investment performance, comparing different investment opportunities, and making informed financial decisions.

4. Using the Calculator

Tips: Enter monthly profit and investment amounts in USD. Both values must be positive numbers, and investment must be greater than zero.

5. Frequently Asked Questions (FAQ)

Q1: What's a good monthly ROI?
A: This varies by industry and risk level. Generally, 1-5% monthly ROI is considered good for most conservative investments.

Q2: How does monthly ROI differ from annual ROI?
A: Monthly ROI measures returns over one month, while annual ROI measures over a year. Monthly ROI can be annualized by compounding.

Q3: Should I include all costs in the investment amount?
A: Yes, include all capital invested including fees and expenses to get an accurate ROI calculation.

Q4: What if my investment value changes during the month?
A: For changing investments, use the average investment value during the month for most accurate results.

Q5: Can ROI be negative?
A: Yes, negative ROI indicates a loss where monthly profit is less than zero.