ROI Calculator
How to Use This ROI Calculator
- Enter your initial investment (total cost).
- Enter the final value (what the investment is worth now or at sale).
- Optionally enter the holding period in years for an annualized figure.
- Click "Calculate ROI" to see your return percentage and net profit.
ROI Formula & Worked Example
ROI = (Final Value − Initial Cost) ÷ Initial Cost × 100
Annualized ROI = (Final ÷ Initial)1/years − 1 (compound annual growth rate)
Example
Invest $10,000, sell for $15,000 after 3 years: ROI = ($15,000 − $10,000) ÷ $10,000 = +50%. Annualized = (1.5)1/3 − 1 = +14.47%/year.
Frequently Asked Questions
What is a good ROI?
It depends on the asset and risk. Long-run stock market returns average ~7–10% annualized; a "good" ROI beats your alternative uses of the money after adjusting for risk. Compare against benchmarks, not arbitrary targets.
Can ROI be negative?
Yes — if the final value is below the initial cost, ROI is negative, meaning you lost money. For example, $10,000 → $8,000 = −20% ROI.
What are the limitations of ROI?
Simple ROI ignores the time value of money (use annualized ROI instead), risk, taxes, fees, and cash-flow timing. For uneven cash flows, IRR or NPV are better metrics.
Shahnawaz
Shahnawaz is the founder of DaProfitClub, a free online platform offering 100+ calculators and converters for finance, health, math, and everyday life. With a background in finance and mathematics, he designs accurate, easy-to-use tools.
Sources: Investopedia — return on investment definition and formula; CFA Institute — performance measurement guidance.