ROI Calculator
Return on investment answers one question plainly: how much did I make relative to what I spent? Enter cost, final value, and holding period for both total and annualized ROI.
Your results
Charts & visualization
Invested vs final value
The height difference is your gain; the percentage depends on how much was deployed.
Every chart’s underlying numbers are available as text — use the “view as table” control under each chart.
How it works
Total ROI divides net gain by everything you actually spent — purchase price plus fees, commissions, or improvements. Annualized ROI then converts that total into a steady per-year rate using the geometric mean, which correctly handles compounding: earning 33% over three years annualizes near 10% per year, not 11%.
Comparing annualized figures is the honest way to judge investments held for different lengths of time — a 20% gain in two years beats a 25% gain in eight.
Formula used
Total invested— amount + additional costsNet gain— final value − total investedyears— holding period used for annualization
Example calculation
Turning a $20,000 investment into $27,500 produces a net gain of $7,500 — a total ROI of 37.5%. Spread across three years, that compounds to an annualized return of about 11.2%, which is the number to compare against index funds, savings rates, or alternative uses of the same cash.
Assumptions & limitations
- Simple ROI model — cash flows are limited to the initial investment and final value.
- Intermediate income such as dividends or rent should be added to final value.
- Annualized ROI assumes smooth geometric growth, not literal year-by-year results.
- Taxes on gains are excluded.
Results are planning estimates based on your inputs and the stated assumptions — not financial advice or a loan offer. Verify important figures with your lender or advisor.
Frequently asked questions
What is a good ROI?
Context decides. Long-run broad stock indexes have averaged roughly 10% nominal annually; beating that consistently is difficult. For business projects, ROI must clear your cost of capital plus risk premium.
Why does annualized ROI differ from dividing total ROI by years?
Because returns compound multiplicatively, not additively. Earning 33% over three years means each dollar grew 1.33× overall — equivalent to growing about 10% per year, not 11%.
How do I handle investments I added money to over time?
Simple ROI becomes misleading with staggered contributions. Use the dollar-cost averaging calculator for periodic purchases, or compute money-weighted returns with a tool that tracks dates and amounts.
Should fees go into ROI?
Yes — include every cost required to obtain the outcome: commissions, closing costs, repairs, management fees. Gross ROI flatters bad decisions.