Interactive ROI Calculator

Calculate Return on Investment with annualized returns and visual analysis. Professional tool for investment performance assessment.

Investment Details
Initial Investment Cost
Original amount invested (e.g., $10,000)
Final Investment Value
Current or ending value (e.g., $12,000)
Duration Input Type
Choose how to enter investment duration
Date Range
Start Date
When the investment began
End Date
When the investment ended
Investment Duration
Length (Years)
Duration of investment (e.g., 3)
Please enter valid investment details to calculate ROI.
-20% 0% Break-even 10% Good 25%+ Excellent

ROI Calculation Formulas

Understanding ROI, Annualized ROI, and investment performance metrics

Return on Investment (ROI) Definition

ROI measures the profitability of an investment by comparing the gain to the initial cost:

ROI = [(Final Value – Initial Cost) ÷ Initial Cost] × 100%

Annualized ROI Definition

Annualized ROI accounts for the investment duration, showing the average annual return:

Annualized ROI = [(Final Value ÷ Initial Cost)^(1 ÷ Years) – 1] × 100%

Investment Gain Definition

The absolute profit or loss from the investment:

Gain = Final Value – Initial Cost

Interpretation Guide

  • ROI > 10%: Strong return – Highly profitable investment
  • ROI 5%–10%: Good return – Reasonable for most investments
  • ROI 0%–5%: Modest return – May not justify risk
  • ROI < 0%: Negative return – Investment resulted in a loss

A positive ROI above 5-7% is generally considered good, though expectations vary by industry and risk level.

How to Use the ROI Calculator

Simple steps for accurate investment analysis

1

Enter Investment Cost

Input the initial amount you invested

2

Enter Final Value

Input the current or ending value of your investment

3

Specify Duration

Enter dates or investment length in years

4

Get Analysis

View ROI, annualized ROI, and performance insights

Frequently Asked Questions

ROI is a performance measure used to evaluate the efficiency or profitability of an investment. It’s calculated by dividing the net profit (final value minus initial cost) by the initial cost and expressing it as a percentage.

ROI is calculated as: [(Final Value – Initial Cost) ÷ Initial Cost] × 100%. For example, if you invested $10,000 and it’s now worth $12,000, your ROI is ($2,000 ÷ $10,000) × 100% = 20%.

Annualized ROI shows the average annual return of an investment, accounting for its duration. It helps compare investments held for different periods using the formula: [(Final Value ÷ Initial Cost)^(1 ÷ Years) – 1] × 100%.

A good ROI varies by investment type and risk level. Generally: above 10% is strong, 5-10% is good, 0-5% is modest, and below 0% is a loss. Compare to market benchmarks and consider risk tolerance.

A negative ROI indicates that the investment resulted in a loss. The final value was less than the initial cost, meaning you lost money on the investment. This suggests poor performance or market conditions.

Duration helps contextualize ROI. A 20% return over 1 year is excellent (20% annualized), but the same return over 10 years is poor (1.8% annualized). Duration enables fair comparison between investments.

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