ROI Calculator (Return on Investment)

How to calculate return on investment

1. Enter the amount invested. This is your starting cost.
2. Enter the final value. Use the current value, or the price you sold for.
3. Add any extra costs (optional). Include fees, commissions, taxes, repairs or other expenses, because they reduce your real return.
4. Add the time held (optional). Enter years and months to see the annualized ROI.
5. Read the result. You will see the ROI percentage, the net profit, the annualized ROI, and how many times your money has grown.

A negative ROI means a loss. For example, an investment of $10,000 that is now worth $8,000 has an ROI of −20%.

ROI formula

ROI = (Final value − Total cost) ÷ Total cost × 100

• Final value = what the investment is worth now, or what you sold it for
• Total cost = the amount invested plus any fees and other costs
• Net profit = final value − total cost

Annualized ROI

A simple ROI ignores how long you held the investment. The annualized ROI turns it into a yearly rate so investments of different lengths can be compared:

Annualized ROI = ((Final value ÷ Total cost) ^ (1 ÷ years) − 1) × 100

This is the same as the compound annual growth rate (CAGR).

Worked example

You invest $10,000, pay no extra costs, and sell for $15,000 after 2 years.

1. Net profit = 15,000 − 10,000 = $5,000
2. ROI = 5,000 ÷ 10,000 × 100 = 50%
3. Annualized ROI = (1.5 ^ (1 ÷ 2) − 1) × 100 = 22.47% a year

Now add $500 of fees. The total cost is $10,500, so the net profit is $4,500 and the ROI is 4,500 ÷ 10,500 × 100 = 42.86%.

What counts as a good ROI?

There is no single answer, because it depends on the risk and the time. Long-run stock market returns have averaged roughly 7 to 10% a year before inflation, and a high-yield savings account pays a few percent with almost no risk. A 50% ROI over 10 years is only about 4.1% a year, which may be less impressive than it sounds, so always check the annualized figure.