ROI Calculator
Return on investmentSee the total and annualized return on any investment. Enter the initial cost, final value, and holding period to compare overall ROI and CAGR.
CAGR is the equivalent annual growth rate over the holding period.
For illustration only. This calculator does not constitute financial advice. Past performance does not guarantee future results.
About this calculator
This calculator computes two standard measures of investment return: ROI (total return over the holding period) and annualized ROI, or CAGR (compound annual growth rate). It is for anyone who wants to see how an investment performed—e.g. after selling a property, cashing out a position, or comparing two investments over different time spans.
Use it when you know the initial cost and final value (or proceeds) and want a clear percentage and an annualized rate. CAGR is especially useful for comparing returns over different holding periods. The calculator does not include taxes, fees, or cash flows during the period; it assumes a single initial outlay and a single final value.
How this is calculated
What this calculator does
The ROI calculator computes two common measures of investment return: ROI (total return over the holding period) and annualized ROI, also called CAGR (compound annual growth rate). You enter the initial cost of the investment, the final value (or proceeds), and the holding period in years.
ROI formula
Return on investment is the percentage gain or loss relative to the initial cost:
ROI = (Final value − Initial cost) / Initial cost
Expressed as a percentage: ROI% = ROI × 100. Example: $10,000 initial and $15,000 final → ROI = 50%.
Annualized ROI (CAGR)
Annualized ROI answers: "What constant yearly return would turn the initial value into the final value over this many years?" It is the compound annual growth rate (CAGR):
Annualized ROI = [(Final value / Initial cost)1/years − 1] × 100
So if you hold for n years, the annualized return r satisfies (1 + r/100)n = Final/Initial. Example: $10,000 → $15,000 over 5 years → (15,000/10,000)^(1/5) − 1 ≈ 8.45% per year.
Assumptions and limitations
We assume a single initial outlay and a single final value with no cash flows in between. CAGR does not account for volatility or the timing of returns; it is the constant annual rate that would produce the same total return. We do not include taxes, fees, or inflation. Results are for illustration only and do not guarantee future performance.
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