How to use the ROI calculator
- Enter the amount invested – include fees and other costs.
- Enter the amount returned – what you sold it for or what it is worth now, plus any income such as dividends or rent.
- Optionally enter how many years you held it, to see the yearly (annualized) return.
ROI formula
\text{ROI} = \dfrac{\text{Amount returned} - \text{Amount invested}}{\text{Amount invested}} \times 100\%\text{Annualized ROI} = \left(\dfrac{\text{Amount returned}}{\text{Amount invested}}\right)^{1/n} - 1
Example: invest 10,000, get back 15,000 after 3 years
ROI = 5,000 ÷ 10,000 = 50%. Annualized, that is 14.47% a year.
ROI ignores how long the money was invested – a 50% return over 1 year is far better than over 10. That is why the annualized figure (the same as CAGR) is shown when you enter the years.
Frequently asked questions
How do you calculate ROI?
Subtract what you invested from what you got back, divide by what you invested and multiply by 100. Investing 2,000 and getting back 2,500 is a 25% ROI.
What is a good ROI?
It depends on the risk and the time. Stock markets have averaged about 7–10% a year after inflation over long periods; a business project is often expected to return more.
What is annualized ROI?
The return per year, compounded. A 50% ROI over 3 years is about 14.47% a year.
Can ROI be negative?
Yes – when you get back less than you put in. Getting back 8,000 on 10,000 is an ROI of −20%.