ROI Calculator
Calculate your return on investment. Annualized ROI, inflation adjustment, and side-by-side comparison. 100% free.
About This Tool
The ROI (Return on Investment) Calculator measures the profitability of an investment by comparing the gain or loss relative to its cost. Enter your initial investment, final value (or revenue), and time period to calculate ROI percentage, annualized return, and total profit or loss.
Formulas
ROI = ((Final − Investment) / Investment) × 100
Annualized ROI = ((Final / Investment)^(1/years) − 1) × 100
Real Return = ((1 + nominal) / (1 + inflation) − 1) × 100
How to Use
- Basic: Enter investment amount and final value to auto-calculate ROI.
- Add holding period (years) to see annualized ROI (CAGR).
- Add inflation rate to see your real (inflation-adjusted) return.
- Reverse: Enter a target ROI to find the required final value.
- Compare: Compare up to 5 investment options side by side.
Frequently Asked Questions
What is ROI?
ROI (Return on Investment) measures the percentage return relative to your investment cost. ROI = (Final Value - Investment) / Investment × 100. For example, if you invest $10,000 and it grows to $13,000, your ROI is 30%.
Why is Annualized ROI important?
A 30% return in 1 year is very different from 30% over 5 years. Annualized ROI converts the total return to an equivalent annual rate, allowing fair comparison between investments with different holding periods.
What is real (inflation-adjusted) return?
Real return subtracts the inflation rate from your nominal return. If your nominal return is 8% and inflation is 3%, your real return is approximately 4.85%. It shows how much your purchasing power actually grew.
What's the difference between ROI and CAGR?
ROI is the total return over the entire period. CAGR (Compound Annual Growth Rate) is the annualized return assuming compound growth. The 'Annualized ROI' in this calculator is equivalent to CAGR.
How do I use the comparison feature?
Select the 'Compare' tab to compare up to 5 investment options side by side. Enter each option's investment amount, final value, and holding period. ROI and annualized ROI are auto-calculated, and the best-performing option is highlighted.
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How It's Calculated
ROI is calculated using:
Basic ROI = ((Final Value − Initial Investment) / Initial Investment) × 100%
Net Profit = Final Value − Initial Investment − Additional Costs (fees, taxes, etc.)
Annualized ROI = ((1 + ROI/100)^(1/years) − 1) × 100%. This allows comparison of investments with different holding periods.
For investments with ongoing cash flows (dividends, rental income): Total Return = (Final Value + Total Cash Flows − Initial Investment) / Initial Investment × 100%
The calculator also computes the doubling time using the Rule of 72: Years to Double ≈ 72 / Annual Return %.
⚠️ Disclaimer
ROI calculations shown here are based on the values you input and assume no additional risk factors. Past returns do not guarantee future results. Investment involves risk of loss. Consider all costs, taxes, and risks before making investment decisions.
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