Return are basic analyzed computation made to assess how an investment is performing. Every investment can be represented as a set of inflows and outflows. Return is the comparison of the inflow and outflow and therefore the benefit to the investor from making the investment. Returns can be positive or negative. A negative return means that the investment has yielded losses rather than benefits. Option trading tips are extended by various research hubs to facilitate positive returns.
Consider these examples:
- A lot of gold was purchased for Rs.5 lakhs and sold for Rs. 4 lakhs
- A silver brick was bought for Rs.10 thousand and sold for Rs.15 thousand.
On basis of a comparison of inflows and outflows, clearly, the first investment has resulted in a loss, whereas the second has yielded a profit. The first case represents negative return on investment; the second is an example of positive return.
Return can be measured in two ways:
- Comparing amount of inflows and amount of outflows on an investment in absolute rupee terms.
- Computing a rate of return by comparing inflows and outflows.
Of course, all investors strive for positive returns. In order to attain this strive, they claim for commodity tips.