ROI vs margin: which one matters?

Both. They answer different questions. Margin tells you how much GP a single flip puts in your bank. ROI tells you how efficient that flip is per GP committed. Confuse them and you end up either bored or broke.

The definitions, plain

Margin (after tax): sell price minus buy price minus the 2% sale tax. An absolute GP number.

ROI: margin divided by buy price, expressed as a percentage. The efficiency of the flip per GP you put in.

Worked example. You buy a Dragon scimitar at 60,000 and sell at 62,000. Tax is 1,240. Margin is 740. ROI is 740 divided by 60,000 = 1.23%.

When margin is the right metric

When your bankroll has slack and the buy limit is your bottleneck, you want absolute margin. You are deploying capital into a finite number of slots and the question is how much profit each slot generates.

Examples where margin wins the argument:

• You have 100M sitting idle, four GE slots free, and you want flips that put real GP in your bank, not 0.5% returns.
• You only flip part-time and want each closed flip to be worth the 4-hour wait.
• You are flipping high-tier rares where bankroll is no constraint and slot scarcity is.

When ROI is the right metric

When capital is your bottleneck and you can run many flips in parallel, you want high ROI. A 5% ROI on 1M of capital, run six times a day, beats a 0.3% ROI on 100M run once a day, every time.

Examples where ROI wins:

• You are starting out with under 5M and need to compound capital fast.
• You only have an hour a day to play and need each minute of attention to count.
• You are running cheap bulk flips on high-volume consumables and want to see which ones return capital fastest.

The big-number trap

A 4M margin sounds incredible. On a 1.4B Twisted bow, that is a 0.28% ROI before tax, 0.27% after. If you only have 1.4B because you sold a Twisted bow yesterday, sure, do the flip. If you have 5M, you cannot do this flip at all, and chasing it is a fantasy.

Likewise, a 28% ROI sounds amazing. If it is on a Helm of neitiznot priced at 30k, the absolute margin is 8k. You need to flip 125 of those to clear 1M in profit. The buy limit is 70 every 4 hours. Possible, but you need enough volume for that to actually fill.

Profit per limit, the number most flippers ignore

Profit per limit is margin multiplied by the buy limit. It tells you the maximum theoretical profit from one full 4-hour cycle of an item. This is the metric that combines both ROI and margin into something actionable.

Example: an item with 200 GP margin and a 25,000 buy limit has 5M profit per limit. An item with 50,000 margin and a 25 buy limit has 1.25M profit per limit. The first item, despite tiny margins, generates four times more profit per cycle if you can deploy the capital.

Putting it together

1. Bankroll under 5M: sort by ROI. Capital is the constraint. Flip cheap, fast, and often.
2. Bankroll 5M to 100M: sort by profit per limit. The middle game is about deploying capital into slots that pay back per cycle.
3. Bankroll over 100M: sort by absolute margin. Slots are scarce, capital is not. Each closed flip should be meaningful.