A performance measure used to evaluate the efficiency of an investment, calculated as the gain or loss relative to the amount invested.
The concept dates to early accounting practices, but the specific phrase 'return on investment' became standardized in early 20th century finance. 'Return' comes from the idea of something coming back to you, while 'investment' derives from Latin investire (to clothe or surround).
The metaphor of 'return' is beautifully circular - you send money out into the world and hope it comes back to you with friends. It's one of the few business metrics that everyone from CEOs to small investors can instantly understand, making it a universal language of financial success.
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