# You asked: How do you calculate actual return on investment?

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## How do you calculate actual return?

The formula for actual return is: (ending value – beginning value) / beginning value = actual return. Actual return should not be confused with expected return, which is the projected return on an investment based on historic performance combined with predicted market trends.

## How is the return on investment calculated?

Return on investment (ROI) is calculated by dividing the profit earned on an investment by the cost of that investment. For instance, an investment with a profit of \$100 and a cost of \$100 would have a ROI of 1, or 100% when expressed as a percentage.

## How do you calculate actual return on assets?

How Can I Calculate a Company’s ROA? ROA is calculated by dividing a firm’s net income by the average of its total assets. It is then expressed as a percentage. Net profit can be found at the bottom of a company’s income statement, and assets are found on its balance sheet.

## What is actual return in stock market?

An actual return refers to the actual gain or loss an investor experiences on an investment or in a portfolio. It is also referred to as the internal rate of return (IRR). It can greatly affect net worth.

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## What is the difference between actual return and expected return?

Actual return can be calculated using the beginning and ending asset values for the period and any investment income earned during the period. Expected return is the average return the asset has generated based on historical data of actual returns.

## What is a realistic return on investment?

Generally speaking, if you’re estimating how much your stock-market investment will return over time, we suggest using an average annual return of 6% and understanding that you’ll experience down years as well as up years.