ROI Calculator
Calculate Return on Investment (ROI) as a percentage and annualized rate. Use it to evaluate stocks, real estate, marketing campaigns, or any investment.
Frequently Asked Questions
How do you calculate ROI?
ROI = ((Final Value − Initial Investment) ÷ Initial Investment) × 100. If you invested $10,000 and it grew to $14,500: ((14,500 − 10,000) ÷ 10,000) × 100 = 45% ROI. For annualized ROI (to compare investments of different durations): Annualized ROI = (1 + ROI/100)^(1/years) − 1. A 45% ROI over 3 years = (1.45)^(1/3) − 1 ≈ 13.2% per year.
What is a good ROI for an investment?
A "good" ROI depends on the investment type and risk level. The historical average annual return of the S&P 500 is approximately 10% (7% adjusted for inflation). Real estate averages 4–10% annually including appreciation and rental income. Marketing ROI benchmarks vary widely by channel; email marketing often returns $36–42 for every $1 spent. Compare any investment's ROI to your opportunity cost and the risk taken.
What is the difference between ROI and IRR?
ROI measures the total return as a percentage of cost, without considering time. IRR (Internal Rate of Return) is the annualized rate that makes an investment's net present value equal to zero, accounting for the timing of all cash flows. IRR is more useful for comparing investments with different time horizons and irregular cash flows, such as real estate projects or business ventures. For simple single-period investments, ROI suffices.