ROI is an important measure of an investment's performance but it has some drawbacks. Andrew Beattie was part of the original editorial team at Investopedia and has spent twenty years writing on a ...

Excess return refers to the return on an investment that surpasses the return of a benchmark or a risk-free rate. It measures the performance of an investment in relation to its expected or required ...

Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia. David Kindness is a Certified Public Accountant (CPA) and an expert in the fields of ...

Waterfalls in private equity and venture capital dictate how investment returns are distributed among stakeholders. These structures determine who gets paid, in what order, and under what conditions.