📊 ROI Calculator

Calculate return on investment, annualized ROI, and compare investment performance.

Investment Details

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$
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Total ROI
0%
Net Profit / Loss
$0
Annualized ROI (CAGR)
0%
Total Return (incl. income)
$0
Multiple on Investment
0×

What is ROI?

Return on Investment (ROI) is a performance metric used to evaluate the efficiency or profitability of an investment. It measures the return relative to the investment's cost, expressed as a percentage.

ROI = (Final Value − Initial Cost + Income) / Initial Cost × 100%

CAGR = (Final Value / Initial Cost)^(1/years) − 1

ROI vs. CAGR

ROI gives the total percentage return over the entire period. CAGR (Compound Annual Growth Rate) normalizes the return to an annual rate, making it easy to compare investments of different durations.

What Counts as a Good ROI?

  • Stock market: average historical S&P 500 return ~10% annually (7% inflation-adjusted)
  • Real estate: typically 8–12% annually including rental income and appreciation
  • Savings accounts: 4–5% in current high-rate environment
  • Bonds: 3–6% depending on duration and credit quality
What's the difference between ROI and profit margin? +
ROI compares profit to the cost of investment, while profit margin compares profit to revenue. ROI is better for comparing the efficiency of different investments; profit margin is used to evaluate business operations and pricing.
How do I account for inflation in ROI? +
To get real (inflation-adjusted) ROI: Real ROI ≈ Nominal ROI − Inflation Rate. More precisely: Real Rate = (1 + Nominal) / (1 + Inflation) − 1. With 10% nominal ROI and 3% inflation, your real ROI is approximately 6.8%.