ConvertOnlineROI Calculator with Annualized Return
Report source: https://convertonline.org/calculators/roi-calculator
Compare the amount invested with the amount returned, then account for the holding period to make returns from different investments easier to compare.
ROI Calculator
Return on investment
Calculation schedule
| Period | Cash flow | Present value | Cumulative value |
|---|
ROI Calculator formula
ROI = (amount returned − amount invested) ÷ amount invested × 100. Annualized ROI = (amount returned ÷ amount invested)^(1 ÷ years) − 1.
Annualized ROI is meaningful only when the holding period is positive and the ending value supports the calculation.
Assumptions and limitations
- Cash flows between the initial investment and final return are excluded.
- Dates use the actual number of elapsed days divided by 365.2425.
- Taxes, inflation, fees, and investment risk are excluded unless already reflected in the amounts entered.
Worked example
Example: $10,000 grows to $15,000
An investment of $10,000 that returns $15,000 produces a $5,000 gain and a total ROI of 50%.
Over a three-year holding period, the annualized ROI is about 14.47%, which expresses the return as a compounded yearly rate.
Frequently asked questions
What is a good ROI?
A useful benchmark depends on the investment, risk, time period, fees, taxes, and available alternatives. Compare returns measured over the same period.
Why annualize ROI?
Annualized ROI converts a multi-year result to a compounded yearly rate, helping compare investments held for different lengths of time.
Can ROI be negative?
Yes. ROI is negative when the amount returned is less than the amount invested.
This calculator provides an estimate for planning and education. Actual cash flows, rates, taxes, fees, inflation, and investment outcomes may differ.