Enter the current period value ($) and the previous period value ($) into the Return on Value Calculator. The calculator will evaluate and display the Return on Value. 

Return on Value Formula

The following formula is used to calculate the Return on Value. 

ROV = (CPV - PPV) / PPV * 100
  • Where ROV is the Return on Value (%)
  • CPV is the current period value ($) 
  • PPV is the previous period value ($) 

How to Calculate Return on Value?

The following example problems outline how to calculate Return on Value.

Example Problem #1:

  1. First, determine the current period value ($).
    • The current period value ($) is given as: 100.
  2. Next, determine the previous period value ($).
    • The previous period value ($) is provided as: 80.
  3. Finally, calculate the Return on Value using the equation above: 

ROV = (CPV – PPV) / PPV * 100

The values given above are inserted into the equation below and the solution is calculated:

ROV = (100 – 80) / 80 * 100 = 25.00 (%)


FAQ

What is Return on Value (ROV) and why is it important?
ROV measures the percentage change in value over a period, highlighting the efficiency of investments or financial decisions. It’s crucial for investors and businesses to assess the growth or decline in value of assets or investments, guiding strategic decisions.

How can ROV be applied in financial analysis?
ROV can be applied to evaluate the performance of various investments, including stocks, bonds, and real estate. It helps in comparing the profitability of different investments, enabling investors to make informed choices.

Are there limitations to using the ROV formula?
Yes, ROV focuses solely on the percentage change in value, not accounting for the size of the investment or external factors like market conditions. It should be used alongside other financial metrics for a comprehensive analysis.