ROI Calculator
Calculate Return on Investment percentage to measure the profitability of any investment.
Advertisement
How to Use This Calculator
- Enter your initial investment amount
- Input the final value of your investment
- Optionally add the time period in years for annualized ROI
- Click 'Calculate' to see your return on investment
- Review ROI percentage and net profit
- Compare annualized ROI if you entered a time period
Formula
ROI = [(Final Value - Initial Investment) ÷ Initial Investment] × 100; Annualized ROI = [(Final Value ÷ Initial Investment)^(1/years) - 1] × 100
Frequently Asked Questions
What is ROI and how is it calculated?▼
ROI (Return on Investment) measures the profitability of an investment. It's calculated as: (Final Value - Initial Investment) ÷ Initial Investment × 100. For example, investing $1,000 and receiving $1,500 gives an ROI of 50%.
What's the difference between ROI and annualized ROI?▼
ROI shows total return regardless of time period, while annualized ROI shows the average yearly return. A 100% ROI over 10 years equals about 7.2% annualized ROI. Annualized ROI is better for comparing investments held for different time periods.
What is a good ROI?▼
It depends on the investment type and risk. Stock market historical average is 7-10% annually. Real estate typically sees 8-12%. High-risk investments may target 15%+ annually. Generally, higher returns come with higher risk.
Should I consider inflation when calculating ROI?▼
Yes, for a complete picture. Real ROI = Nominal ROI - Inflation Rate. If you earn 8% ROI but inflation is 3%, your real return is about 5%. This shows your actual purchasing power gain.