Q:

What is a good ROI percentage?

A:

A return of 7 percent is considered a good ROI for someone who invests in the stock or real estate markets, notes Joshua Kennon for About.com. A positive ROI range for bonds is anywhere from 2 to 4 percent.

According to Kennon, dividend stocks that pay a 7 percent rate are safe and stable investments. Non-leveraged properties in the real estate market command the same 7 percent ROI, and inflation can add to an investor's ROI. For instance, 3 percent inflation means a person can yield a 10 percent ROI in the real estate and stock markets.

Investopedia adds that calculating the ROI is accomplished by dividing the return of the investment by the original cost. Calculating ROI is a good way to determine positive ROI or look for lucrative investments elsewhere. Kennon adds that riskier investments should come with higher gains, and the same principle applies to bonds.


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