I've been giving this some thought. 8-9% ROI on a 401K is considered good and to a degree expected. 5% and above on a bank CD is phenomenal.
I've honestly looked at the random sub $50 sales on Afternic and GoDaddy. That's a potential 100% ROI on a hand registered (1st year) domain sale (depending on your registrar) (minus the +/- 20% commission). Personally I'm not about to register a bunch of random numbers hoping that it's a street address in another country or state.
If any investor is getting 100% ROI, I respect that business model.
I don't have enough skin in the game to know what is a reasonable ROI in domaining. Will I accept $40 for a $10 registration fee- Absolutely.
There is no ''average ROI'' in domaining that can be realistically calculated across the industry. You can calculate an ROI on one domain name because you know buying price, sale price and a holding time. But how are you gonna calculate ROI on a huge number of portfolios that consist of extremely different names, different methods and tactics, financial situations, experiences, holding times etc?
It is investing as I said before, but it's not the type of investing where you know the interest rate or can calculate ROI because the average on a market is known for a long time (like if you buy and rent a garage or something). It's more like an ''art dealer'' type of investing.
Now, what is known is an average sell-thru rate and it's 1%. 2% (for a lower xxxx) if you are good (mainly your domain names). So, if you have 100 names, sell them for $40. You'll make $40. But spend $1000 in renewals. Not a very good ROI, huh? )
And I know you're gonna say - well, if I put the price down from $2000 to $40, then I may sell 50% of my stock...! Nope, doesn't work like this. Many people here tried to play with prices, and it's still nothing - the same 1-2%.
Matter of fact I think it's pretty bad strategy, trying to sell $40, because you go right between both target groups - too cheap for end users, and too expensive for resellers (and names probably quite mediocre for both).
Not to be Captain Obvious here, but what matters is a quality, quality and quality of names ))