Free ToolNo signup required
ROI Calculator
Calculate your total and annualised return on any investment.
Total & Annualised ROI
Both metrics calculated from your inputs
Formula Breakdown
See exactly how ROI and CAGR are derived
Gain or Loss
Colour-coded results for positive and negative returns
Calculate Return on Investment
Enter your investment cost and final value to calculate ROI.
How to Calculate Return on Investment
The ROI Formula
Total ROI = ((Final - Cost) / Cost) x 100
Annualised = (Final/Cost)^(1/years) - 1
Total ROI tells you the overall percentage return. Annualised ROI (CAGR) tells you the equivalent yearly compound rate. Use annualised ROI to compare investments held for different periods.
Worked Example
You invest £10,000 and sell 3 years later for £15,000. Total ROI = ((15,000 - 10,000) / 10,000) x 100 = 50%. Annualised ROI = (15,000/10,000)^(1/3) - 1 = 14.5% per year. That 14.5% annual rate is directly comparable to other investments.
What Is a Good ROI?
By Asset Class
Stocks: ~10% average annual return (S&P 500 long-term). Bonds: 4-6% annually. Property: 8-12% including rental yield and appreciation. Cash savings: 1-5% depending on rates. Higher returns generally require accepting more risk and volatility.
By Time Horizon
Short-term (under 1 year): higher returns required to justify risk and transaction costs. Long-term (10+ years): lower annual returns compound significantly. A 7% annual return doubles your money in ~10 years (Rule of 72).
How to Use This ROI Calculator
Enter Investment Cost
What you originally paid or invested.
Enter Final Value
Current or sale value of the investment.
Add Time (Optional)
Enter years to get annualised ROI (CAGR).
ROI vs Other Return Metrics
- ROI vs CAGR. ROI is total return, CAGR is annualised. Use CAGR when comparing investments of different durations.
- ROI vs IRR. IRR (Internal Rate of Return) accounts for the timing of cash flows. Use IRR when you have multiple investments and withdrawals at different times.
- ROI vs Total Return. Total return includes dividends and income, not just capital gains. A stock that returned 8% in capital gains plus 3% in dividends had an 11% total return.
- Nominal vs Real ROI. Nominal ROI ignores inflation. Real ROI adjusts for it. If your ROI is 8% and inflation was 3%, your real ROI is approximately 4.85%.
Want deeper insights?
ARIA calculates your actual portfolio ROI across all holdings with risk-adjusted metrics and optimisation.
Create Free Account