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ROI Calculator – Return on Investment and Annualized Return

Calculate the return on any investment as a percentage, plus the annualized return (CAGR) so you can compare investments held for different lengths of time. Works for shares, property, crypto, marketing campaigns and business projects.

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How to use the ROI calculator

  1. Enter the amount invested, including fees and costs.
  2. Enter the amount returned — the final value, or what you sold for plus any income received.
  3. Enter how long you held it in years (0.5 for six months).

The result shows the ROI, the gain or loss, the annualized return (CAGR) and the money multiple.

The formulas

ROI = (Final value − Initial investment) ÷ Initial investment × 100
CAGR = (Final value ÷ Initial investment)^(1 ÷ years) − 1

Worked example

You invest $10,000 and three years later it is worth $15,000:

  • Gain = $5,000
  • ROI = 5,000 ÷ 10,000 × 100 = 50%
  • CAGR = (15,000 ÷ 10,000)^(1 ÷ 3) − 1 ≈ 14.47% a year
  • Money multiple = 1.5×

Comparing two investments

InvestmentROIYearsCAGR
A50%3about 14.5%
B80%8about 7.6%

B has the bigger ROI, but A grew almost twice as fast each year.

Getting an accurate ROI

  • Include all costs: commissions, platform fees, taxes paid, property repairs.
  • Include all income: dividends, interest and rent received.
  • Think about inflation: a 14% yearly return with 3% inflation is about 10.7% in real terms — see the inflation calculator.
  • Remember risk: a higher return often comes with a bigger chance of loss.

ROI for property

For a rental property, a fair ROI includes everything you put in — the down payment, closing costs and any renovation — and everything you got back: rent after expenses each year plus the profit when you sell, after selling costs and loan repayment. A home that rose 30% in value can still have a modest ROI once mortgage interest, maintenance, insurance and agent fees are counted. Running the numbers before buying shows whether the investment is worth the risk and effort.

ROI vs other measures

ROI is quick and easy to explain, which is why businesses use it so often. For investments with money going in and out at different times — regular deposits, dividends or rent — a measure such as the internal rate of return (IRR) or a money-weighted return is more accurate. For a simple “I put in this much and got back that much” question, ROI and CAGR give a clear answer.

ROI in business and marketing

For a campaign that cost $2,000 and brought in $6,000 of extra profit, ROI = (6,000 − 2,000) ÷ 2,000 = 200%. Use profit, not revenue, for a fair figure.

To project future growth, use the compound interest calculator. For simple percentage changes, try the percentage calculator. Past returns don’t guarantee future results — see our disclaimer.

Frequently asked questions

How do I calculate ROI?

ROI = (final value − amount invested) ÷ amount invested × 100. If you invest $10,000 and get back $15,000, ROI = 5,000 ÷ 10,000 × 100 = 50%.

What is CAGR?

The compound annual growth rate is the steady yearly return that would turn your starting amount into the final amount over the same time: CAGR = (final ÷ initial)^(1 ÷ years) − 1. A 50% gain over 3 years is a CAGR of about 14.47% a year.

Why use CAGR instead of ROI?

ROI ignores time. A 50% return over 3 years is much better than 50% over 10 years. CAGR turns both into a yearly rate you can compare directly.

What counts as the amount invested?

Everything you put in: the purchase price plus fees, commissions and costs such as renovation for a property. For a marketing campaign, use the full campaign cost.

What is a good ROI?

It depends on risk and time. As a reference, broad stock markets have historically returned somewhere around 7% to 10% a year over long periods, before inflation, with big swings from year to year.

Can ROI be negative?

Yes. If you get back less than you put in, the ROI is negative — for example −20% if $10,000 becomes $8,000.

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