ROI Calculator - Return on Investment
ROI (Return on Investment) measures how much profit you made relative to what you invested. This calculator gives you the total ROI as a percentage, the net profit or loss in currency, and the annualized ROI - the equivalent yearly return if held for the specified period.
How to calculate ROI
The total ROI divides your net gain by the initial investment and expresses it as a percentage. The annualized ROI uses the compound annual growth rate (CAGR) formula to tell you the equivalent per-year return, making it easy to compare investments with different time horizons.
ROI = (Final - Initial) / Initial x 100 | Annualized = (Final/Initial)^(1/years) - 1Example. Investing 1,00,000 that grows to 1,50,000 over 3 years is a 50% total ROI and an annualized ROI of about 14.47% per year.
Frequently asked questions
What is a good ROI?
It depends on the asset class and risk. Equity markets have historically returned 10-15% annually; a bank FD might return 6-7%. A higher ROI is better, but always compare against the risk taken and alternatives available.
What is CAGR?
CAGR (Compound Annual Growth Rate) is the annualized ROI shown here. It represents the steady year-by-year return that would get you from the initial to the final value over the given period.
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