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ToolBoxGenie

ROI Calculator

Calculators · Added 15 August 2026

Return on investment states a gain as a percentage of what was put in. Enter the amount invested and what it became; add a holding period and the calculator also gives the annualised rate, which is the only fair way to compare investments held for different lengths of time.

The total you put in, including costs.

What it is worth or sold for.

yrs

Add this to get an annualised figure.

How to use the roi calculator

  1. 1Enter the amount invested, including any costs that were part of getting in.
  2. 2Enter the final value — what it is worth now, or what it sold for.
  3. 3Optionally enter the holding period in years to get an annualised figure.
  4. 4Press Calculate.
  5. 5Compare the total and annualised figures. The gap between them is the effect of time, and it is usually larger than people expect.

Examples

A three-year holding

Input
₹1,00,000 invested, worth ₹1,50,000 after 3 years
Result
ROI 50.00% total · 14.47% annualised

Not 16.67% a year. Compounding means the annual rate is always below the total divided by the years.

The same return over fifteen years

Input
₹1,00,000 to ₹1,50,000 over 15 years
Result
ROI still 50% total, but only 2.74% annualised

Identical ROI, completely different investments. This is exactly why the total figure is a poor comparison on its own.

A loss

Input
₹1,00,000 invested, worth ₹50,000
Result
ROI −50.00%

ROI handles losses normally. Note the asymmetry: recovering from −50% needs a +100% gain.

About the roi calculator

Why ROI needs a time period to mean anything

ROI is the most quoted investment statistic and the least complete. Told that something returned 50%, you know almost nothing useful, because the statement omits the one variable that determines whether that is excellent or dismal.

Fifty percent over three years is roughly 14.5% a year, which comfortably beats most alternatives. The same 50% over fifteen years is 2.7% a year, below inflation in most periods and worse than a deposit account with none of the risk. Same ROI, opposite verdicts.

This is why any serious comparison uses an annualised figure. It answers 'what constant yearly rate would have produced this outcome', which puts every investment on the same footing regardless of how long it was held. Fund factsheets quote annualised returns beyond one year for exactly this reason, and regulators generally require it.

The asymmetry of gains and losses

One property of percentage returns catches people repeatedly: gains and losses of the same size do not cancel. Lose 50% and you need a 100% gain to get back to where you started, because the recovery works on a base that is now half the size. Lose 20% and you need 25%. Lose 90% and you need 900%.

The practical consequence is that avoiding large losses matters more than capturing large gains, which is not intuitive from looking at ROI figures alone. A portfolio that gains 30% and then loses 30% is down 9%, not flat — and the order does not matter, since multiplication commutes.

It also explains why volatility drags on compound returns even when the average return looks fine. A sequence averaging 10% a year with wild swings ends up below one that delivers a steady 10%, because the arithmetic mean of returns is always at least the compound rate, and the gap widens with volatility. When an investment quotes an average annual return without saying whether it is arithmetic or compound, that distinction is worth asking about.

Frequently asked questions

What is the ROI formula?
(Final value − amount invested) ÷ amount invested, expressed as a percentage. It is deliberately simple, which is both why it is used everywhere and why it needs the annualised figure alongside it to mean much.
Why is the annualised return lower than the total divided by the years?
Because returns compound. A 50% gain over three years is not 16.67% a year, since each year's growth applies to a larger base than the last. The correct calculation is the compound rate connecting the endpoints — 14.47% here. Dividing total return by years overstates the annual rate, and the error grows with the period.
What is the difference between ROI and CAGR?
ROI is the total return over the whole period; CAGR is the annualised compound rate. The annualised figure this calculator produces is a CAGR. Use ROI when the period is fixed and understood, and the annualised figure whenever you are comparing things held for different lengths of time.
Does this account for money added along the way?
No. ROI assumes a single amount invested and left alone. If you contributed repeatedly, ROI on the final balance attributes your own deposits to growth and overstates the return badly. For a series of investments the right measure is an internal rate of return, often called XIRR.
Are taxes and fees included?
Only if you build them in. Add transaction costs to the amount invested and subtract tax from the final value to get a net figure. The calculator works with whatever numbers you give it, and gross ROI is always the flattering version.

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