ROI Calculator
Calculate return on investment, net gain and annualised ROI.
Return on investment
ROI = (16000 − 10000) ÷ 10000 × 100
CAGR = ((16000 ÷ 10000) ^ (1 ÷ 3) − 1) × 100
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Not financial advice. Results are estimates for general information only and are not financial, investment or tax advice. Figures ignore fees, taxes and inflation unless stated. Consult a qualified adviser before making a decision.
Frequently asked questions
How is ROI calculated?
Subtract the initial cost from the final value to get net gain, divide by the initial cost, and multiply by 100 to get a percentage.
What is annualised ROI and why does it matter?
It restates the total return as an equivalent compound yearly rate, so investments held for different lengths of time can be compared fairly. A 60% total return is 60% annualised over one year but only 4.8% over ten.
Does this account for fees and taxes?
Not automatically. Subtract transaction fees, management charges and tax from the final value, or add them to the initial cost, to get a net figure.
Can ROI be negative?
Yes. A final value below the initial cost gives a negative ROI, which is the percentage of your capital lost.
About the ROI Calculator
ROI is net gain divided by cost:
ROI = (final value − initial cost) / initial cost × 100
Simple ROI ignores time, which makes it easy to misread. A 60% return is excellent over one year and mediocre over ten. The annualised figure fixes this by converting to a compound annual growth rate:
Annualised ROI = ((final / initial) ^ (1 / years) − 1) × 100
Compare investments on the annualised number, and only compare like with like: the calculation ignores fees, taxes, dividends reinvested and the risk taken to earn the return. Two investments with the same annualised ROI are not equivalent if one of them could have lost everything.