How is ROI calculated?

ROI = (final value − initial investment) / initial investment × 100. A result above zero is a gain; below zero is a loss.

How is the annualized ROI calculated?

It uses the same formula as CAGR: (final / initial)^(1 / years) − 1, then multiplied by 100. It is the steady annual rate that would produce the same total return.

Does it include taxes and fees?

No. Enter your actual net proceeds (after fees and taxes) as the final value if you want those costs reflected in the ROI.

What if my investment lost value?

Enter the current (lower) value as the final value. The ROI will be negative, showing the percentage loss.

Can I share a calculation?

Yes. Use the share button to copy a link that reopens the calculator with the same inputs.

ROI Calculator

Enter your initial investment and the final value. The calculator instantly shows your ROI as a percentage, the net profit or loss, and — if you enter a holding period in years — the annualized return.

Use it to measure how much you gained or lost on any investment relative to what you put in, expressed as a simple percentage and a currency amount.

Return on investment (ROI)

50%

Initial investment Profit

Net profit / loss: +$500.00 (gain)

The result updates as you type. The bar splits the final value into your original investment and the gain; it turns red when the final value is below the initial investment.

How does it work?

ROI measures the total percentage gain or loss relative to the initial cost. It does not account for the time value of money unless the annualized figure is used. Taxes, fees, and inflation are not included.

Return on investment (ROI) formula

ROI = \frac{FV - IV}{IV} \times 100

ROI: Return on investment as a percentage.
FV: Final value of the investment.
IV: Initial investment (cost).
ROI_a: Annualized ROI (optional): ROI_a = \left(\frac{FV}{IV}\right)^{1/n} - 1 where n = holding period in years.

Investing $1,000 and ending with $1,500 gives an ROI of 50%. Held for 3 years, the annualized ROI is about 14.47%.

Method & sources

ROI is calculated as (final value − initial investment) / initial investment × 100. Annualized ROI (optional) uses the same formula as CAGR: (final / initial)^(1/years) − 1. Taxes, transaction costs, inflation, and dividends received are not included unless already reflected in the final value.

Sources

Where this method comes from — use these references to understand the formula, assumptions, and limits.

Return on investment — U.S. Securities and Exchange Commission (Investor.gov), verified 2026-06-10

How we calculate

ROI is calculated as (final value − initial investment) / initial investment × 100.
Annualized ROI (optional) uses the same formula as CAGR: (final / initial)^(1/years) − 1.
Taxes, transaction costs, inflation, and dividends received are not included unless already reflected in the final value.
The currency shown follows the site language; the maths is the same in every market.
Both values must be positive; the calculator handles both gains and losses.

Rounding

ROI percentages are rounded to two decimal places. Currency amounts are rounded to two decimal places. The annualized ROI uses the same precision.

What the calculator does

It divides the net gain (final value minus initial investment) by the initial investment and multiplies by 100 to produce a percentage. When you supply a holding period, it also shows the annualized ROI — the equivalent steady annual return that would produce the same total result.

How to use it

Enter the initial investment — what you paid or put in.
Enter the final value — what it is worth now (or was worth when you sold).
Optionally enter the holding period in years to see the annualized return.
Read the ROI percentage, net profit or loss, and annualized ROI.

An example

You invest $1,000 and sell for $1,500 after 3 years. ROI = (1,500 − 1,000) / 1,000 × 100 = 50%. Net profit: $500. Annualized ROI ≈ 14.47% — meaning a steady 14.47% per year would have produced the same result.

ROI vs annualized ROI

ROI is the total percentage gain over the whole holding period, regardless of how long you held it. Annualized ROI (identical in formula to CAGR) converts that into a per-year rate, making it easier to compare investments held for different lengths of time.

When it is useful

Evaluating a stock, property, business venture, or any asset after you know the start and end values. Also useful for quickly comparing two investments held for different periods by annualizing both.

FAQ

How is ROI calculated?: ROI = (final value − initial investment) / initial investment × 100. A result above zero is a gain; below zero is a loss.
How is the annualized ROI calculated?: It uses the same formula as CAGR: (final / initial)^(1 / years) − 1, then multiplied by 100. It is the steady annual rate that would produce the same total return.
Does it include taxes and fees?: No. Enter your actual net proceeds (after fees and taxes) as the final value if you want those costs reflected in the ROI.
What if my investment lost value?: Enter the current (lower) value as the final value. The ROI will be negative, showing the percentage loss.
Can I share a calculation?: Yes. Use the share button to copy a link that reopens the calculator with the same inputs.

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