The question we all ask
How much do I earn if I invest in this?
The answer is returns.
Simple definition
It's the money you earn or lose.
You invest 1,000€. One year later: 1,100€.
You earned 100€. Or 10% yearly.
Types
Positive: You earn. Good. Negative: You lose. Bad. Zero: Neither. Boring.
Returns vs Profit
Profit: The extra money (100€) Returns: The percentage (10%)
Returns matter when comparing investments.
Realistic expectations
Bank: 0.5-2% (safe) Index funds: 7-10% (historical) Stocks: 5-50% (luck)