RoR, or rate of return
RoR, or rate of return, shows how profitable an investment has been over a set period (including income from dividends). RoR helps investors see how their investments are performing, and can be used to compare against other investments (and doesn’t require a set time period). RoR can help with investors’ decisions to buy, hold or sell their investments.
The RoR formula is:
Example: If you invested US$1,000 in a stock, and after one year, the stock's value increased to U$1,200, and you received US$50 in dividends (income), the RoR would be 25%:
We acknowledge and thank the FMA, Dr Karena Kelly and Brook Taurua Grant, the RBNZ and the Māori Dictionary for their research which helped us with te Reo Māori kupu for this glossary.
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