Investment ROI Calculator
Calculate total return, annualized CAGR, and profit or loss on any investment.
Total ROI
+50.00%
Total Profit / Loss
$5,000.00
Total ROI
+50.00%
Annualized ROI (CAGR)
+14.47%
How Investment ROI Is Calculated
This investment ROI calculator computes three key metrics: total ROI, annualized ROI (CAGR), and absolute profit or loss. Total ROI is simply (Final Value − Initial Investment) / Initial Investment × 100. It tells you your percentage gain or loss relative to what you put in.
Annualized ROI (CAGR — Compound Annual Growth Rate) normalizes your return across the holding period: CAGR = (Final / Initial)^(1/years) − 1. This is the most useful metric for comparing investments held for different durations. An investment that returned 50% over 2 years (CAGR ≈ 22.5%) outperformed one that returned 50% over 5 years (CAGR ≈ 8.5%), even though the total ROI looks identical.
When evaluating an investment, compare its CAGR to a relevant benchmark — typically the S&P 500 for US stock investments, which has historically returned approximately 10% annually. An investment significantly underperforming a passive index fund may not justify the risk or management effort involved.
For the most accurate calculation, use your actual cost basis (purchase price plus all buying costs) as the initial investment, and your actual proceeds (sale price minus all selling costs and taxes owed) as the final value. This gives you your true net return — the money that actually ended up in your pocket.