ROI Calculator
Compute return on investment and optional annualized ROI from initial and final values.
Written by Golam Rabbani, Founder & Lead Engineer
How to use this roi calculator
- Enter your initial investment (cost basis).
- Enter the final value of the investment today (or at sale).
- Optionally, enter the holding period in years to get an annualized ROI.
- Pick a currency for the labels.
- Press Calculate to see total ROI %, gain, and annualized ROI %.
- Use Copy to share the result, or Reset to evaluate another investment.
About this roi calculator
ROI (return on investment) measures the percentage gain or loss relative to the initial cost. The basic formula is: ROI % = (final value − initial investment) ÷ initial investment × 100. When you also supply a holding period in years, the calculator returns the annualized ROI using the standard compound-growth formula: annualized % = ((final ÷ initial)^(1 ÷ years) − 1) × 100. These definitions come from the U.S. SEC's Investor.gov primer on investment returns and Investopedia's "Return on Investment" reference.
Worked example: USD 10,000 invested, worth USD 14,500 after 3 years. Total ROI = (14,500 − 10,000) ÷ 10,000 × 100 = 45.00%. Annualized = ((14,500 ÷ 10,000)^(1 ÷ 3) − 1) × 100 ≈ 13.18% per year. The 45% headline can be misleading without context — spread over 3 years it is roughly 13% compounded annually, which is what you would compare against benchmarks like an index fund's return. Currency is just a label; there is no exchange-rate lookup or live market pricing.
FAQ
- What is the formula for ROI?
- ROI % = (gain ÷ cost) × 100, where gain = final value − initial investment. For USD 10,000 → USD 14,500: gain USD 4,500, ROI 45%.
- How is annualized ROI different from total ROI?
- Total ROI is the cumulative gain over the whole holding period. Annualized ROI is the constant per-year compound rate that would produce the same final value — useful for comparing investments held for different periods.
- What does a negative ROI mean?
- A loss. If final value is below initial investment, ROI is negative and annualized ROI shows the per-year compound loss rate.
- Does this account for fees, taxes, or dividends?
- No — ROI here is the simple price-to-price ratio. To include fees and taxes, subtract them from the final value before entering it. For dividend-paying assets, add reinvested dividends to the final value.
- Is annualized ROI the same as CAGR?
- Yes — when there are no intermediate cash flows, annualized ROI and Compound Annual Growth Rate (CAGR) are computed by the same formula and produce the same number.
- Are my figures saved?
- No. The calculator is client-side; nothing is uploaded or stored.