Return on Investment (ROI)- Explained

We utilize it to measure effectiveness of investments made. To calculate ROI we use the proportion of investment income to the amount invested. In particular, it should be calculated as proportion of increase or decrease of the ‘bank’ to the initial amount of the ‘bank’.

When using the word ‘bank’ we mean the amount of money destined for the sports campaign or for the whole process.

Example:

We have a bankroll of $3,000 that we’re going to we’re going to use as our ‘bank’ for our campaign.  After any bet settlement we could calculate the rate of our ROI for this campaign.

Let’s say the first week we earn a profit of $300 so the total bank amount equals $3300. Then dividing the growth of $300 to the initial investment of $3,000 we have a 10% ROI. After a month of playing, if we have total ‘bank’ amount of $4200, these would mean that we’ve managed a 40% of ROI.

In sports wager in order to understand your plan, the ROI calculation should be at least on minimum on 6 months, but most of professional bettors calculate it on year.

So when using ROI we should always mention the referred time interval. Other factors that influence ROI are:

1. The correlation between the amount of the bet and the total ‘bank’ amount.
2. The number of the bets for the time interval given.