ROI Calculator: Return on Investment and Annualized

Use this ROI calculator to see your total return on investment, your annualized return (CAGR) and your real return after inflation.

Gain / loss–
Total ROI–
Annualized return (CAGR)–
Real annual return–

Use decimals for partial years (6 months = 0.5). Dividends or extra contributions make this an approximation.

ROI formulas

ROI = (End value − Start value) ÷ Start value Annualized return (CAGR) = (End ÷ Start)^(1 ÷ Years) − 1 Real return = (1 + CAGR) ÷ (1 + Inflation) − 1

ROI example

$10,000 invested three years ago is now worth $14,500:

  • Gain: $4,500
  • Total ROI: 45%
  • Annualized return: about 13.2% a year
  • With 3% inflation, real annual return: about 9.9%

Comparing investments fairly

  1. Annualize: a 45% gain over three years and a 20% gain over one year aren’t comparable until both are annual rates.
  2. Include costs: fees, commissions and taxes reduce your real return.
  3. Benchmark: compare a stock portfolio with the S&P 500, not with a savings account.
  4. Adjust for risk: higher returns usually come with bigger drawdowns.

Average multiple purchases first with the average cost calculator, and project future growth with the compound interest calculator. New to investing? Start with index funds for beginners.

Frequently Asked Questions

How do you calculate ROI?

ROI = (Current value − Amount invested) ÷ Amount invested × 100. $10,000 growing to $14,500 is a 45% ROI.

What is annualized return?

Annualized return (CAGR) spreads total return evenly across the years: (End ÷ Start)^(1 ÷ years) − 1. A 45% gain over three years is about 13.2% a year.

What is a good ROI?

The US stock market has historically returned around 10% a year before inflation. Compare your result with a benchmark of similar risk.

This content is for general information only and is not investment advice. Consider your own situation and consult a licensed professional before making financial decisions.