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ROI Calculator

Return on investment: profit and ROI percent. Choose simple (total) or annualized ROI over a given number of years for comparison.

Result

ROI

20%

Profit
$200.00
How it’s worked out
  1. Profit = $1,200.00 − $1,000.00 = $200.00
  2. ROI = profit ÷ amount invested × 100 = 20%

ROI Calculator

What this calculator does

This calculator computes return on investment (ROI) as profit (returned − invested) and ROI percent (profit / invested × 100). You can choose simple ROI (total return over the whole period) or annualized ROI (equivalent rate per year over a given number of years). All amounts are in the same currency (e.g. dollars).

It is useful for comparing investments, evaluating a business or project, or understanding how much you gained or lost on a sum of money. Investors and small-business owners use it for quick performance checks. It does not account for risk, fees, taxes, or inflation.

How to use it

  1. Enter amount invested (e.g. initial capital or cost).
  2. Enter amount returned (or current value; e.g. sale proceeds or portfolio value).
  3. For simple mode: read profit and ROI % (total return over the whole period).
  4. For annualized mode: also enter years held; read total ROI % and annualized ROI % per year. Annualized lets you compare investments held for different lengths of time.

Inputs are in the left panel; the result updates as you change values. Use the same currency for invested and returned.

Formulas used

  • Profit = returned − invested. (Negative if you lost money.)
  • Simple ROI % = (profit / invested) × 100 (or 0 if invested = 0). This is the total percentage return over the entire period.
  • Annualized ROI % = ((returned / invested)^(1/years) − 1) × 100.
    This is the constant annual rate that would grow "invested" to "returned" over "years." Use it to compare a 2-year investment with a 5-year one on a per-year basis.

Annualized is useful to compare investments over different holding periods. For example, 20% over 2 years is roughly 9.54% per year; 20% over 5 years is roughly 3.71% per year.

Interpretation & examples

  • Example 1 (simple): $1,000 invested, $1,200 returned → $200 profit, 20% ROI.
  • Example 2 (annualized): Same $1,000 → $1,200 over 2 years → annualized ROI ≈ 9.54% per year (so (1.0954)^2 ≈ 1.2).
  • Example 3: $5,000 invested, $4,000 returned → −$1,000 profit, −20% ROI. Use annualized with years held to express the loss as a per-year rate if needed.

ROI does not show risk or opportunity cost; a high ROI might have come with high volatility or a long wait. Use for illustration and comparison only.

History & background

ROI is a standard performance measure in finance and business. Annualized return is used in mutual funds, benchmarks, and regulatory disclosure so that returns over different periods are comparable. The formulas are standard; this calculator applies them with no adjustment for fees or taxes.

Limitations & safety notes

  • Not financial advice. ROI does not account for risk, fees, taxes, or inflation. Use for illustration and comparison only.
  • For complex investments or tax implications, consult a financial professional. Past performance does not guarantee future results.