ROI Calculator
🏠 Free ToolCalculate your return on investment (ROI) as a percentage and annualized rate. Enter the initial investment, final value, and time period to see your total and annual returns.
How it Works
Our ROI calculator computes the return on investment for any asset or project. Enter the initial cost, final value, and holding period to instantly see your total ROI percentage, annualized return, and absolute profit or loss.
The ROI formula divides the net gain by the original cost. While simple, this metric is one of the most widely used measures in finance and business. It helps you evaluate whether an investment was worthwhile and compare different opportunities on equal footing.
Annualized return is especially useful for comparing investments held for different time periods. A 50% total return over 5 years is very different from 50% over 1 year. The annualized figure normalizes this so you can make fair comparisons.
The visual comparison bar shows your initial investment alongside the final value, making it easy to see the magnitude of your gain or loss at a glance. Remember that ROI does not account for risk — a higher ROI often comes with higher risk.
Frequently Asked Questions
How is ROI calculated?
ROI = (Final Value - Initial Investment) / Initial Investment x 100. For example, if you invest €10,000 and it grows to €15,000, your ROI is 50%.
What is annualized return?
Annualized return converts a total return into an equivalent yearly rate using the formula: ((Final/Initial)^(1/years) - 1) x 100. This lets you compare investments with different time periods.
What is a good ROI?
A 'good' ROI depends on the investment type and risk. The stock market historically returns 7-10% annually. Real estate averages 8-12%. Any ROI above inflation (2-3%) preserves purchasing power.
Does this calculator account for fees and taxes?
No, this calculator shows gross ROI. To calculate net ROI, subtract all fees, taxes, and costs from your final value before entering it. Net ROI is always lower than gross ROI.
Can ROI be negative?
Yes. If your final value is less than your initial investment, you have a negative ROI, meaning you lost money. A -50% ROI means you lost half your investment.
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