ROI Calculator
ROI Results
5,000.00
Net Profit
50.00%
ROI
1.50x
Return Multiple
22.47%
Annualized ROI
What is ROI?
Return on Investment (ROI) is a performance metric used to evaluate the efficiency of an investment. It measures the return of an investment relative to its cost, expressed as a percentage. A positive ROI means the investment was profitable; a negative ROI means a loss.
ROI is widely used in business, real estate, stock market investing, and marketing to compare the effectiveness of different investments or decisions.
How to Use This ROI Calculator
- Initial Investment: Enter the total cost of the investment.
- Final Value: Enter the value or revenue received from the investment.
- Years (optional): Enter the investment period to calculate annualized ROI.
- The calculator shows net profit, ROI %, return multiple, and annualized return.
Frequently Asked Questions
What is a good ROI?
A "good" ROI depends on the investment type and risk level. Stock market investments historically return 7–10% annually. Real estate may yield 8–12%. Higher-risk ventures may target 20%+. Always compare ROI to alternative investments of similar risk.
What is the difference between ROI and annualized ROI?
ROI measures total return over the entire investment period. Annualized ROI (CAGR) normalizes that return to a per-year figure, making it easier to compare investments held for different durations.
Does ROI account for inflation?
Standard ROI does not account for inflation. To get the real ROI, subtract the inflation rate from your annualized return. For example, a 10% annualized ROI with 3% inflation gives a real return of approximately 7%.
Can ROI be negative?
Yes. A negative ROI means the investment lost value — the final value is less than the initial cost. For example, investing 10,000 and getting back 8,000 gives an ROI of −20%.
Formula
Annualized = (1 + ROI/100)^(1/n) − 1