If you are planning to trade and invest in cryptocurrency, then better carry detailed analysis first. It will not only let in make smart decisions, but also prepare you for smooth trading and investing. There are many analytical tools available on the internet. If you are just getting started with Bitcoin trading, Immediate Profit is the most trusted trading platform.
Among those available tools to make detailed analysis, ROI (Return on Investment) will serve as one of the greatest tools to start with. However, at the time of calculating and determining the time for ROI, several important factors are there you should consider.
Before moving further, getting an insight to ROI will be a good idea.
What is ROI?
ROI, i.e., Return on Investment is a measurement that helps in evaluating the return from an asset present in the market by analyzing its performance. In cryptocurrency, it plays an essential role. By peeping in the concepts of ROI, it will become easy to make out whether a specific marketing strategy is working properly or not.
In case the ROI related to any project is not good enough, then it indicates the need for implementation of change in the strategy of investment. ROI will give you an idea whether any asset is performing better than the previous situation or not.
ROI pays special attention to the tangible profit margin that has been produced by an asset with time. While calculation of ROI, you may expect to come across two different outcomes:
- Positive ROI: Positive ROI indicates that the net returns have exceeded the cost of investment.
- Negative ROI: Negative ROI means that here the net return became low.
After getting an idea about ROI, the next turn is to peep into the formula for calculation of ROI.
Which Formula is Used for Calculation of ROI?
It is a quite simple formula used for calculation off ROI. Having an understanding of basic Mathematics will help. The formula looks like-
Return on Investment (ROI) = ((Current Value – Original Price)/ Original Price)
As a cryptocurrency investor, you must not refrain from calculation of ROI. For coming across crypto trading experience comprising highly advanced features.
What are Some Vital Points to Note at the Time of Calculating ROI?
There are several steps associated with the calculation of Return on Investment. Taking them in high consideration will make the calculation easy. Those steps include the following:
- Risk tolerance to consider:
First and foremost, it is essential to take your risk tolerance in high consideration. Investors planning to avoid any type of risk must not refrain from opting for low-rate ROI. On the other hand, investors looking forward to reap high profits must go for higher ROI option.
- Taking speculative cryptocurrencies in account:
Secondly, Speculative cryptocurrencies must be taken into consideration to get a clear idea about their performance. Returns associated with crypto investment may be a bit substantial in case of some leading cryptocurrencies. In order to make out the most, it is essential to go through a detailed note about the cryptocurrency that interests you the most. As investing in cryptocurrency seems to be a bit risky, it is essential to carry a thorough research at the time of making an investment. Reducing of the original price at the time of calculating ROI will be a vital step. The actual outcome must be divided by cost of investment.
How Long May It Take to Get ROI in Cryptocurrency?
Calculation of time related to getting the ROI in cryptocurrency totally depends on the overall status of the cryptocurrency in the present market. As the market is volatile, it is a bit difficult to predict the actual time it may take in coming across the desired ROI.
To get more precise result, it is advisable to stay up-to-date with the market trends. It will give you an exposure regarding the present state of the crypto coin where you have made your investment. Making purchase will be a tempting idea when the market price remains low.
But at the time of selling of cryptocurrency, it is better carry out with a detailed research. Selling when the market price is high will increase the chances of getting a better ROI.
Conclusion
In conclusion, staying up-to-date with changing market trends and having the ability to take risks will make crypto trading a joyful experience.
