Finance ROI calculator
Calculate return on investment as a percentage and as an annualised rate, so holdings of different lengths can actually be compared.
Total cost, including fees and your time if you cost it.
Total value received, not just the profit.
Leave blank to skip the annualised figure.
Return on investment
+45.0%
Profit of $4,500.00.
Annualised return
+45.0%
Compound rate per year over 1.0 years.
- Invested
- $10,000.00
- Returned
- $14,500.00
- Profit
- $4,500.00
- Multiple
- 1.45×
- Holding period
- 1.0 yr
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Reembun. (2026, July 28). ROI calculator. https://reembun.com/roi-calculator
How to use it
Enter what you put in
Amount invested is the total cost, including fees and anything else you had to spend to make it happen.
Enter what came back
Amount returned is the total value received, not the profit on its own.
Add the holding period
Over how many months turns a plain return into an annualised one, which is the only fair way to compare investments of different lengths.
Read both figures
Return on investment is the raw percentage. Annualised return is what it works out to per year.
The formula
profit = returned − invested
ROI = profit ÷ invested × 100And the annualised version, which is where the calculation becomes genuinely useful:
annualised = ((returned ÷ invested) ^ (1 ÷ years) − 1) × 100The exponent is what accounts for compounding. It answers the question: what constant yearly rate would have taken the starting amount to the ending amount over this period?
A worked example
$10,000 invested, $14,500 returned after 12 months:
- Profit: $4,500
- ROI: 45%
- Multiple: 1.45×
- Annualised: 45% (the period is exactly one year)
The same $4,500 profit earned over three years instead:
- ROI: still 45%
- Annualised: 13.2%
Identical ROI, very different investments. The first is exceptional; the second is a decent equity return.
Why raw ROI misleads
| Total ROI | Over | Annualised |
|---|---|---|
| 20% | 6 months | 44.0% |
| 20% | 1 year | 20.0% |
| 20% | 3 years | 6.3% |
| 20% | 10 years | 1.8% |
| 100% | 5 years | 14.9% |
| 100% | 10 years | 7.2% |
The last two rows are the useful pair. Doubling your money sounds the same in both cases; one is a strong return and the other is roughly the long-run market average.
Where ROI is used, and its limits
Marketing. Return on ad spend is a form of ROI, and the usual mistake is measuring revenue rather than margin. A campaign returning 300% on revenue may be losing money if the gross margin is 25%.
Property. ROI on a rental should include purchase costs, maintenance, vacancy and taxes, not just rent against price. Ignoring them routinely overstates returns by several percentage points.
Business projects. Include the fully loaded cost: salaries, tooling, opportunity cost of the team not doing something else.
What ROI cannot tell you
Risk. Two investments both returning 12% annualised are not equivalent if one could plausibly have returned −80%. ROI is a realised outcome, not a distribution.
Sequence. For anything you are drawing income from, the order in which returns arrive matters as much as their average. A portfolio that falls early and recovers is worth far less to a retiree than one that rises early and falls late, even at identical annualised returns.
Tax and fees. A 10% gross return with a 1% annual fee and 20% capital gains tax is not a 10% return to you. Compare after-cost, after-tax figures wherever you can.
Treat ROI as the start of the analysis rather than the end of it, and get advice from a regulated adviser before committing capital on the strength of a percentage.
Common questions
Why does annualised return matter more than total ROI?
Because total ROI ignores time. A 50% return is excellent over one year and mediocre over ten. Annualising converts both to a per-year rate so they can be compared. 50% over one year is 50% a year; 50% over ten years is 4.1% a year, which is roughly a savings account.
Is annualised return the same as CAGR?
Yes. Compound annual growth rate is the same calculation: the constant yearly rate that would take the starting value to the ending value over the period. Both smooth out volatility, which is a feature when comparing and a limitation when assessing risk.
Should I include my own time as a cost?
For a business or marketing investment, usually yes. A campaign that returns 30% on media spend but consumed forty hours of your time has a very different return once that time is priced. For a passive financial investment there is no time cost to add.
What does ROI not tell me?
Risk, volatility, liquidity and taxes. Two investments with identical ROI can differ enormously in how likely they were to lose everything, how easily you could exit, and what you keep after tax. ROI is one number among several, and on its own it is not a decision.
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