What is ROI and how is it calculated?

ROI (Return on Investment) measures profit or loss relative to cost. Formula: ROI % = (Returned − Invested) / Invested × 100.

It depends on the asset and risk. Broad equity markets historically average ~7–10% annually over long periods. Businesses may target 15–30% depending on risk and capital needs.

Does ROI account for time?

Basic ROI does not. To compare investments over different time spans, use annualized return such as CAGR: (Returned/Invested)^(1/years) − 1.

What if my investment made a loss?

The ROI will be negative. This calculator displays losses in red and shows the negative percentage accordingly.

Return on Investment (ROI) Calculator

Compute gain/loss, ROI %, and annualized return (CAGR). Fully client-side.

Inputs

Mode: Dates Currency: £

Currency

Use dates Use length

Amount invested Amount returned

From date To date

Include fees

Results

Investment gain

£0.00

ROI

0.00%

Annualized return (CAGR)

—

Length (years)

—

Invested Profit Loss

How to use this ROI calculator

Select your currency and choose “Use dates” or “Use length”.
Enter the amount invested and the amount returned.
If applicable, tick “Include fees” and add any costs (brokerage, platform fees, closing costs, etc.).
Click Calculate (or press Ctrl/Cmd+Enter) to see ROI %, gain/loss, investment length, and annualized return (CAGR).

What the formulas mean

ROI % measures profitability relative to cost: (Returned − Invested) / Invested × 100. This tells you how much you earned or lost per unit of capital deployed. Because ROI does not account for time, it’s best for simple comparisons or short projects.

CAGR (Compound Annual Growth Rate) expresses the average annual rate of return over a period: (Returned / Invested)^(1/years) − 1. Use CAGR when you want to compare investments with different holding periods. In this tool, “years” are derived from calendar dates (using 365.2425 days) or your provided duration.

Practical examples

Invested £5,000, received £6,500 after 2 years, with £50 fees: Net invested = £5,050, gain = £1,450 → ROI ≈ 28.71%. Annualized return via CAGR ≈ (6500/5050)^(1/2) − 1 ≈ 13.45% per year.

Common use cases

Comparing multiple investments (fund A vs. fund B) over different time spans.
Evaluating property flips or rental improvements (include transaction costs as fees).
Marketing campaign ROI (spend vs. attributable revenue).
Startup or project performance snapshots for quick reporting.

Informational only — not financial advice. Double-check results before making decisions.

FAQ

Do you upload any of my inputs?

No. All calculations happen in your browser.

What if the investment made a loss?

The ROI will be negative and the chart shows the loss in red.

How is time handled?

For dates, years are computed using 365.2425 days for accuracy. For length, we use the value you provide.

What is a good ROI?

It depends on risk and asset class. Broad equity markets historically average ~7–10% per year; businesses may target 15–30% for projects.

Is ROI better than NPV or IRR?

ROI is simple but time-agnostic. NPV/IRR account for timing and discount rates, which can be more informative for long-term projects.

5 Fun Facts about ROI & CAGR

A 50% loss needs 100% back

Drop from 100 to 50? You need to double (100% gain) just to break even—percent moves aren’t symmetric.

Recovery math

CAGR hides the rollercoaster

+50%, then −50% gives a 0% CAGR, but your money is down 25%. Geometric returns ignore the drama but keep the truth.

Volatility drag

Fees compound too

A 1% annual fee on a 7% return turns 30 years of growth into ~6% CAGR—small drags become huge over time.

Cost gravity

Time stretches ROI headlines

“+20% ROI” over 10 years is only ~1.84% CAGR. Always ask “per year?” before celebrating.

Annualize it

Early cash flows win

Projects with quick paybacks can beat slower “bigger” returns once you annualize—time is a multiplier, not a footnote.

Speed bonus