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ROI Calculator

Calculate return on investment, net profit, and annualized returns.

ROI calculator

Solve for

Enter initial and final values — we’ll compute ROI, profit, and annualized return.

Initial investment
$
050k100k200k
Final value
$
050k100k200k
Investment period Optional — enables annualized ROI
years
051530
Advanced · cash flow & inflation
Added contributions Money added after the initial buy
$
Withdrawals / fees Money taken out along the way
$
Inflation-adjusted (real return)
% inflation / yr

Examples

How It Works

Return on Investment (ROI) is a simple measure of how profitable an investment is relative to its cost. It is expressed as a percentage: a positive ROI means you made money, a negative ROI means you lost money.

The basic formula is: ROI = (Final Value − Initial Investment) / Initial Investment × 100. For example, if you invested $10,000 and it grew to $15,000, your ROI is ($15,000 − $10,000) / $10,000 × 100 = 50%.

When comparing investments of different durations, annualized ROI (also called Compound Annual Growth Rate or CAGR) is more useful. It answers: "What was the equivalent annual return?" The formula is: Annualized ROI = ((Final / Initial)1/n − 1) × 100, where n is the number of years.

For example, a 50% total ROI over 5 years is an annualized ROI of about 8.45% per year. This lets you compare it fairly against a 30% ROI over 3 years (which is 9.14% annualized — actually better on a per-year basis).

Tips & Best Practices

Always use annualized ROI when comparing investments with different time horizons.
ROI doesn't account for risk — a 20% ROI from stocks is not the same as 20% from bonds.
Factor in inflation to get 'real' returns: subtract the inflation rate from your nominal ROI.
Consider all costs (fees, taxes, maintenance) in your initial investment for accurate ROI.
The Rule of 72: divide 72 by the annual return rate to estimate how many years to double your money.

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Frequently Asked Questions

What is ROI?

Return on Investment (ROI) measures the percentage gain or loss on an investment relative to its cost. An ROI of 50% means you earned 50% on top of your original investment. It's the most basic measure of investment performance.

Annualized ROI (or CAGR) converts a total return into an equivalent annual rate. This lets you fairly compare investments held for different periods. A 100% return over 10 years is about 7.2% per year, while 50% over 3 years is about 14.5% per year.

Yes, a negative ROI means you lost money on the investment. If you invested $10,000 and the final value is $8,000, your ROI is −20%.

The Rule of 72 is a quick estimation: divide 72 by the annual return rate to find how many years it takes to double your money. At 8% annual return, it takes about 72/8 = 9 years to double.

Basic ROI does not account for time — a 50% return over 1 year and 50% over 10 years have the same ROI but very different performance. Use annualized ROI (CAGR) to account for the investment period.