See what your investment really returned.
Enter what you put in and what it grew to. Get your total profit, ROI percentage, and the annualized return that lets you compare any investment fairly, no matter how long you held it.
The investment
Additional costs cover fees, commissions, improvements or taxes you paid on top of the initial amount. They are added to your cost basis so the return reflects your true out-of-pocket total.
What these numbers tell you
How your money grew
Value from cost basis to final value
How it compares to the market
Annualized return vs common benchmarks
Return scorecard
Year-by-year value
Assumes the investment grew at a steady annualized rate (CAGR) from your cost basis to the final value.
| Year | Value | Gain to date | ROI to date | Growth this year |
|---|
If you had invested elsewhere
What your cost basis would have grown to at each benchmark's typical annualized return over the same number of years.
| Where | Annual return | Ending value | Total gain |
|---|
ROI, explained
How to Calculate Return on Investment
Return on Investment (ROI) measures the profitability of an investment as a percentage of its original cost. The basic formula is: ROI equals the net profit divided by the total investment cost, multiplied by 100. If you invest $10,000 and sell for $13,000, your net profit is $3,000 and your ROI is 30%. This straightforward calculation works for any type of investment, from stocks and real estate to business equipment and marketing campaigns. When calculating ROI, be sure to include all associated costs such as transaction fees, maintenance expenses, and taxes to get an accurate picture of your true return.
Simple ROI vs Annualized ROI
Simple ROI measures the total return over the entire holding period without accounting for time, while annualized ROI converts that return into a yearly rate that allows fair comparisons across investments held for different durations. A 50% total return sounds impressive, but it matters enormously whether that gain took 2 years or 10 years. Annualized ROI for a 50% gain over 2 years is approximately 22.5%, while the same gain over 10 years is only about 4.1%. The annualized formula uses the compound annual growth rate (CAGR) calculation, which accounts for the compounding effect and provides the most accurate basis for comparing investment alternatives.
ROI Benchmarks by Investment Type
Different investment types carry different ROI expectations that reflect their varying risk levels. The S&P 500 has delivered an average annual return of approximately 10% before inflation and about 7% after inflation over the past century. Real estate investments typically target 8% to 12% annual returns including both rental income and appreciation. Corporate bonds historically return 4% to 6% annually, while U.S. Treasury bonds yield 2% to 4%. Business investments and venture capital aim for much higher returns of 20% or more to compensate for their significantly higher failure rates. Understanding these benchmarks helps you evaluate whether a specific investment opportunity offers competitive returns for its risk level.
Limitations of ROI as a Metric
While ROI is widely used because of its simplicity, it has several important limitations that investors should understand. Basic ROI does not account for the time value of money, meaning a 20% return over one year and a 20% return over five years appear identical despite being vastly different in value. ROI also ignores risk, so a guaranteed 5% bank CD and a volatile stock that averaged 5% would show the same ROI despite very different risk profiles. Additionally, ROI calculations can be manipulated by selectively including or excluding costs, and the metric does not capture opportunity cost. For a more complete analysis, investors should use ROI alongside other metrics like net present value, internal rate of return, and risk-adjusted returns such as the Sharpe ratio.
Common questions
How is ROI calculated?
Basic ROI = (Final Value - Initial Investment) / Initial Investment x 100. If you invested $50,000 and it is now worth $75,000, your ROI is ($75,000 - $50,000) / $50,000 x 100 = 50%. This tells you the total percentage return.
What is annualized ROI?
Annualized ROI adjusts the return to a yearly rate, making it easy to compare investments held for different periods. The formula is: ((Final/Initial)^(1/Years) - 1) x 100. A 50% return over 3 years is about 14.5% annualized.
What is a good ROI?
It depends on the investment type and risk. The S&P 500 averages about 10% annually. Real estate typically returns 8%-12% including appreciation and rental income. Bonds average 4%-6%. Any investment consistently beating the S&P 500 is performing well.
Does ROI account for inflation?
Basic ROI does not account for inflation. For a real (inflation-adjusted) ROI, subtract the inflation rate from your annualized return. A 10% nominal ROI with 3% inflation gives a real ROI of about 7%. Always consider inflation for long-term investments.
Estimates for planning only. Past performance does not guarantee future results, benchmark averages are long-run figures and any single year can differ widely, and real returns depend on fees, taxes, inflation and risk. Verify every figure before you rely on it.