Return on Investment (ROI) Calculator
Enter the investment cost and final value (or proceeds) to compute the return on investment percentage and absolute profit.
Input Data
Results
At a glance:ROI% = (final value − investment cost) ÷ investment cost × 100. Profit = final value − cost. Annualised ROI = [(1 + ROI)^(1 ÷ years) − 1] × 100 (geometric annualisation).
Formula
ROI% = (final value − cost) ÷ cost × 100.
Profit = final value − cost.
Annualised = (1 + ROI)^(1 ÷ n) − 1.
How to Use
- Enter the investment cost and final value.
- Optionally enter the holding period in years.
- The ROI%, profit and annualised return are computed.
FAQ
What is the difference between ROI and annualised ROI?
ROI is the total return regardless of time held; annualised ROI spreads that return evenly across each year so different holding periods can be compared. The two are equal for a one-year hold and diverge the longer the period.
Does ROI consider risk?
No. ROI looks only at return and ignores volatility and probability. A high ROI may carry high risk, so pair it with other metrics such as the Sharpe ratio or maximum drawdown for a fuller picture.
Should fees and taxes be included in the cost?
Yes. Brokerage, tax and management fees should be counted in the cost or deducted from the final value, otherwise ROI is overstated. Enter all expenses in the cost field.
Is ROI negative when you lose money?
Yes. When the final value is below the cost, ROI is negative and profit is negative, directly reflecting the loss.
How does ROI differ from NPV, and which should I use?
ROI simply shows the relative return percentage. NPV shows the absolute amount after discounting for the time value of money. Use ROI for small, quick decisions; for large, long-term decisions, NPV is more robust.
How do I compute ROI for property?
Use the sale price (or valuation) as the final value and the purchase price plus renovation and fees as the cost. If you include rental income, add the net rent over the holding period to the final value, then annualise for comparison.
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References
Content review: Calculatorism Science Team. Results are for reference only; please refer to the relevant authorities for the official figures.