ROI Calculator
Calculate return on investment (ROI) and annualized return (CAGR) for any investment — stocks, real estate, business, crypto, or savings.
Investment Details
Total amount you invested
Current value or sale proceeds
How long you held the investment
For real (inflation-adjusted) ROI. ~3% for 2026
ROI vs. CAGR: Which Should You Use?
📊 Simple ROI
Total percentage gain or loss over the full period.
ROI = (End − Start) / Start × 100
- Best for short-term (under 1 year) comparisons
- Doesn't account for time
- Easy to calculate and understand
- Useful for one-off transactions
📈 CAGR (Annualized)
Yearly average rate, accounting for compounding.
CAGR = (End/Start)^(1/Years) − 1
- Best for multi-year comparisons
- Standard for benchmarking (S&P 500: ~10% CAGR)
- Smooths out year-to-year volatility
- Assumes reinvested growth
Frequently Asked Questions
What is ROI?
ROI (return on investment) is a performance measure used to evaluate the efficiency of an investment. The formula is: ROI = (Net Profit / Cost of Investment) × 100. A positive ROI means the investment gained value; a negative ROI means it lost value. ROI is usually expressed as a percentage.
What is CAGR?
CAGR (compound annual growth rate) is the annualized average growth rate of an investment over a period longer than one year, assuming the profit is reinvested each year. CAGR smooths out the volatility and gives a single comparable rate. Formula: CAGR = ((End Value / Start Value)^(1/Years)) − 1.
What is a good ROI?
It depends on the asset class and risk. Historically, the S&P 500 has returned about 10% per year annualized. Real estate averages 8-12% total return. Bonds yield 3-5%. A "good" ROI is one that beats inflation (~3% in 2026) and matches the risk taken. Risky assets (crypto, startups) typically need 20%+ ROI to be worth the risk.
What is the difference between simple ROI and annualized ROI?
Simple ROI is the total percentage gain or loss over the entire holding period. Annualized ROI (CAGR) is the equivalent yearly rate. For example, a 100% gain over 5 years is a 20% annualized ROI, not 100% per year. Use simple ROI for short-term comparisons and CAGR for long-term or multi-year comparisons.
Does ROI account for inflation and fees?
No. Basic ROI does not adjust for inflation, taxes, or fees. A 10% ROI when inflation is 5% gives a "real" return of about 4.9%. To get a true picture, subtract the inflation rate and any fees or taxes from your nominal ROI. For a more precise measure, use the real return formula: Real ROI = ((1 + Nominal) / (1 + Inflation)) − 1.
Can ROI be negative?
Yes. A negative ROI means the investment lost money. For example, buying a stock at $100 and selling at $80 gives an ROI of -20%. Most investors target a positive ROI, but a single negative investment doesn't necessarily mean a bad strategy if other investments in the portfolio offset it.