ROI Calculator
Measure the return on any investment by entering your initial cost, final value, dividends, and holding period. See total ROI percentage, annualized return, and net gain after accounting for additional costs.
Return on investment (ROI) is the single most-cited measure of how an investment performed, and also one of the most frequently misused. The simple version — gain divided by cost — works fine for a quick scoreboard. But it doesn't tell you whether 50% over 5 years is better or worse than 30% over 2, and it ignores income (dividends, distributions, rents) that arrives along the way.
This calculator computes both the total ROI percentage and the annualized return (CAGR — compound annual growth rate). It also includes optional inputs for dividends received during the holding period and additional costs (trading fees, advisory fees, holding fees), which is how you'd evaluate a real-world investment rather than a textbook one.
Use it to evaluate stocks, mutual funds, real estate flips, rental properties, side businesses, art, or any asset where you can pin down a cost basis and an exit value. The math is identical; the data quality varies a lot by asset class.
Inputs
Results
Total ROI
53.47%
Annualized Return
15.35%
Net Gain/Loss
$5,400
Total Return
$15,500
Investment Breakdown
Cost vs Return
Formula
How to use this calculator
- Enter the initial investment — what you paid to acquire the asset, in dollars.
- Enter the current value (or the price you sold at). For unrealized investments, use today's market price.
- Enter the holding period in years. You can use fractions: 0.5 for six months, 2.25 for 27 months.
- Enter total dividends, distributions, or income received during the holding period (rental income, bond coupons, stock dividends, etc.). Leave at $0 if none.
- Enter additional costs incurred while owning the asset — trading commissions, advisory fees, property taxes, repairs. These reduce your real ROI.
- Compare total ROI for raw performance and CAGR for time-adjusted performance. CAGR is the right number to compare against other investments held for different periods.
Worked examples
Stock held for 3 years
Bought 100 shares of XYZ at $100 = $10,000 Sold at $150 = $15,000 Dividends received: $500 Trading fees: $20 Net gain: $5,480 Total ROI: 54.7% CAGR: ≈ 15.6% per year For comparison: S&P 500 averaged about 10% per year before inflation. This was a strong return.
House flip — same ROI, different annualized return
Bought a house for $200,000, sold a year later for $250,000. Rehab + closing + fees: $30,000. Net gain: $20,000 Total ROI: ($20,000 / $230,000) × 100 ≈ 8.7% CAGR: 8.7% per year (same as total ROI because the holding period is exactly 1 year) Looks fine — until you compare to the time required. Most flips have hidden time costs (your labor, opportunity cost of the cash, financing interest) that the ROI calculation ignores.
Long-held mutual fund
Initial investment: $5,000 Held: 15 years Final value: $18,500 Reinvested dividends already in final value Fees: $300 over the holding period Net gain: $13,200 Total ROI: 264% (impressive) CAGR: ≈ 8.7% per year (basically average market return) A massive total ROI sounds huge, but spread over 15 years it works out to a roughly typical return. CAGR is what tells you whether the strategy worked or just rode time.
When to use this calculator
Use ROI for a single, well-defined investment with a clear start and end. It's perfect for evaluating individual stocks, a real estate deal, a side business sale, or any one-shot investment.
It is NOT the right tool when: - Cash flows are irregular and bidirectional (you add money over time AND withdraw it). Use IRR (internal rate of return) instead, which handles uneven cash flows. Many spreadsheet apps provide IRR functions. - You want to evaluate a portfolio with ongoing contributions. Time-weighted return is the industry standard there. - Comparing investments with very different risk profiles. ROI says nothing about volatility. A 12% return on a steady bond fund is very different from a 12% return on cryptocurrency.
For ongoing portfolio modeling with contributions, see the compound interest calculator. For specific stock-portfolio P&L, see the investment returns calculator.
Common mistakes to avoid
- Confusing total ROI with annualized return. A 100% ROI over 10 years is much weaker than a 100% ROI over 2 years. Always look at CAGR when periods differ.
- Forgetting dividends and distributions. For dividend-paying assets, ignoring these can understate the real return by 2–4 percentage points per year.
- Including fees inconsistently. If fees are paid out of pocket, include them. If they're skimmed off the investment (typical for mutual funds and ETFs), the final value is already net of fees — don't subtract them twice.
- Comparing nominal returns across very different time periods. Inflation eats real returns. A 50% nominal ROI in a high-inflation decade may have produced near-zero real gain.
- Ignoring taxes. Your after-tax ROI is what actually matters for compound growth. Long-term capital gains are taxed at 0%, 15%, or 20%; short-term gains are taxed as ordinary income.
- Cherry-picking the start date. Quoting "ROI since I bought" can hide drawdowns. Look at rolling returns to understand consistency.
Frequently Asked Questions
Sources & further reading
- Calculating returns on investments — U.S. Securities and Exchange Commission
- Total return: a fuller measure — FINRA
- CAGR explained — Morningstar