ROI Calculator: Return on Investment
How much an investment earned, in total and per year.
Good to know. 50% over five years sounds better than 8.4% a year. They’re the same thing.
Not financial advice. Uses only the numbers and rates you enter — no live data.
How it works
In plain words
ROI is the gain divided by what you invested. The annualized return (compound annual growth rate) is the yearly rate that would turn the amount invested into the final value over the same number of years.
The formula
ROI = (value − invested) ÷ invested × 100 annualized = (value ÷ invested)^(1 ÷ years) − 1
Worked example
10,000 grew to 15,000: a gain of 5,000 and a return of 50%. Over 5 years, that is 1.5^(1/5) − 1 = 8.45% a year.
Sources
- Brealey, Myers and Allen, Principles of Corporate Finance, chapter 2 The standard formulas for loan payments, compounding and present value, the same as a spreadsheet’s PMT and FV.
Sources checked September 30, 2026. 4 automated tests check its answers on every change.
About the ROI calculator: return on investment
Return on investment answers the simplest question about any investment: for every unit you put in, how much did you get back? A 50% ROI means 10,000 became 15,000. It works for shares, funds, property, a business or a course that raised your salary, as long as you count everything you put in and everything you got out.
ROI on its own ignores time, and time matters. A 50% return in one year is exceptional; over twenty years it is poor. That is why the calculator also shows the annualized return, also called the compound annual growth rate (CAGR): the steady yearly rate that would produce the same result. 50% over five years is 8.45% a year, not 10%, because each year’s growth builds on the last.
Include income you received along the way, such as dividends, interest or rent, in the final value, and include costs such as fees, taxes paid and maintenance in the amount invested. Otherwise the return looks better or worse than it really was.
For money added over time, like monthly savings into a fund, a single ROI gets harder to read, because not every unit was invested for the whole period. The compound interest calculator shows how regular contributions grow at a given rate. Past returns are no guide to future ones, especially over short periods.
Questions people ask
How do I calculate ROI?
Subtract what you invested from what it is worth now, divide by what you invested, and multiply by 100. 10,000 to 15,000 is a 50% ROI.
What is the difference between ROI and annualized return?
ROI is the total return. The annualized return spreads it over the years as a compound yearly rate: 50% over 5 years is 8.45% a year.
Should dividends be included?
Yes. Add dividends, interest or rent you received to the final value to get the total return.
What is a good ROI?
It depends on the risk and the time. Broad stock markets have historically returned several percent a year above inflation over long periods, with big swings along the way.