How to Use This Calculator
How to Calculate ROI
1. Enter your initial investment amount
2. Enter the current or final value
3. Add any additional costs (fees, taxes)
4. Optionally enter time period for annualized returns
Formula
ROI Formula
ROI (%) = [(Final Value - Total Cost) / Total Cost] × 100
Annualized Return = [(Final Value / Total Cost)^(1/Years) - 1] × 100
Examples
Example: Stock Investment
- Initial Investment: $10,000
- Final Value: $15,000
- Time: 5 years
- ROI: 50%
- Annualized: 8.45%/year
Frequently Asked Questions
What's a good ROI?
It depends on the investment type. Stocks average 10% annually, real estate 8-12%, while savings accounts offer 1-3%. Any positive ROI is good, but compare to alternatives and adjust for risk.
Should I include taxes in my ROI calculation?
Yes, for accurate ROI, include all costs like capital gains taxes, transaction fees, and management fees in the additional costs field.
What's the difference between ROI and annualized return?
ROI shows total return over the entire period, while annualized return shows the average yearly return rate, making it easier to compare investments of different durations.