Discover MOIC (Multiple On Invested Capital)

MOIC (Multiple On Invested Capital) is an indicator used to measure the profitability of an investment. It can be used to evaluate a financing, an investment fund, once capital and interest are recovered.

MOIC is calculated by dividing the total amount of cash recovered or expected at the end of an investment (including interest, dividends, capital gains and any other form of return) by the amount invested to obtain these returns. It is generally established at the end of an investment to determine whether or not it has proved profitable.

The MOIC is often higher than the prime rate of return, which means that capital and interest have been recovered more quickly than expected.
For example, if the initial investment is $1 million and the total expected return is $3 million, the MOIC would be x3, meaning that the investment has generated triple income.

The MOIC is an important indicator, as it measures how profitable an investment has been. However, it is important to note that it does not give a complete picture of an investment's profitability, as it does not take into account long-term risks and rewards.