From the course: Pre-investing: Before Investing in Real Estate

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Measures of return summary

Measures of return summary - Microsoft Excel Tutorial

From the course: Pre-investing: Before Investing in Real Estate

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Measures of return summary

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- [Instructor] In this lecture, we're going to do a too long, didn't watch summary of the measures of returns section, so let's do a quick recap. Would you rather know how much you're going to get from an investment but not know when you're going to get it? Or would you rather know when you're going to get it but not know how much you're going to get, or lose? Well, you want to know both, right? And that's why in the measures of return section, we talked about the different measures that allow us to measure two very important things about investments, the magnitude and the efficiency of investments. The magnitude measures how much you're going to get from an investment dollar for dollar, whereas the efficiency is how efficient or how quickly the investment will give those returns back to you as an investor. For the investments that are both low in efficiency and magnitude, these are the clear losers and these are the kinds of investments that you don't want to waste any of your time…

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