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💰 Finance ROI Calculator
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ROI Calculator

Calculate return on investment for any asset, project or venture

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Return on Investment
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Net profit$0
Total cost basis$0
Money multiplier1.00x
Invested
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Final Value
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Net Profit
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ROI
0%
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yrs
Annualized ROI (CAGR)
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Per year, compounded
Total ROI
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Over full period
shares
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Total Stock ROI
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Including dividends
Capital gain$0
Dividends received$0
Fees paid$0
Net profit$0
Total invested$0
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Cash-on-Cash ROI
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Annual return on cash invested
Monthly cash flow$0
Annual cash flow$0
Total cash invested$0
Gross rental yield0%

What is ROI and How to Calculate It

Return on Investment (ROI) is the single most universal metric for measuring investment performance. It quantifies how much profit you generated relative to what you spent — as a percentage. Investors use it to evaluate stocks, rental properties, business decisions, and marketing campaigns. The beauty of ROI is its simplicity: it strips away complexity and answers one question — was this worth it?

This calculator covers four distinct use cases: basic ROI for any investment, annualized ROI (CAGR) for fair multi-year comparisons, stock ROI including dividends and trading fees, and real estate cash-on-cash return. Every result updates in real time as you type.

ROI Formula

ROI = ((Final Value − Initial Investment) / Initial Investment) × 100
Example: $10,000 invested, grows to $13,500 → ROI = 35%.

Annualized ROI (CAGR) Formula

CAGR = ((Final Value / Initial Value)^(1 / Years) − 1) × 100
Example: $10,000 grows to $16,000 over 5 years → CAGR = 9.86% per year.

Real Estate Cash-on-Cash ROI

CoC ROI = (Annual Net Cash Flow / Total Cash Invested) × 100
A property generating $600/month net on $70,000 cash invested = 10.3% CoC ROI.

When to Use This Calculator

Use the ROI calculator any time you need to justify, compare, or evaluate an investment. The annualized ROI (CAGR) mode is essential when comparing investments held for different timeframes — a fair apples-to-apples comparison requires converting total returns to per-year rates.

  • Before making an investment: Model the expected ROI at different exit scenarios — what's the return if the asset grows 5%, 10%, or 20% per year? Set realistic expectations before committing capital.
  • Comparing business projects: Your team is deciding between two initiatives. Project A costs $50,000 and is projected to generate $80,000 in profit over 3 years (ROI = 60%). Project B costs $30,000 and generates $60,000 (ROI = 100%). Project B wins on ROI — but consider risk and timing too.
  • Evaluating marketing spend: You spent $2,000 on ads and generated $9,500 in sales attributed to that campaign. Marketing ROI = ($9,500 − $2,000) / $2,000 × 100 = 375%. Now compare across channels to allocate budget.
  • Real estate analysis: Calculate cash-on-cash return before purchasing a rental property to ensure it meets your minimum investment threshold.

Step-by-Step Example: Comparing Two Stock Investments

You bought Stock A for $8,000 three years ago; it's now worth $11,200 (no dividends). You bought Stock B for $5,000 two years ago; it's now worth $6,800. Which performed better annually? Stock A: CAGR = (11,200/8,000)^(1/3) − 1 = 1.40^0.333 − 1 = 11.9%/year. Stock B: CAGR = (6,800/5,000)^(1/2) − 1 = 1.36^0.5 − 1 = 16.6%/year. Stock B had the better annualized return despite a smaller total gain — because it took less time.

Frequently Asked Questions

What is a good ROI percentage? ▼
It depends on asset class and risk. The S&P 500 averages ~10% annually. Real estate investors typically target 8–12% cash-on-cash. Business projects often require 15–25% or more. Higher ROI generally means higher risk — always weigh return against volatility and time horizon.
What is the difference between ROI and CAGR? ▼
ROI is your total return regardless of time. CAGR (Compound Annual Growth Rate) converts that total return into a per-year figure, accounting for compounding. CAGR is the right metric to compare two investments held for different lengths — e.g., a 3-year investment vs. a 7-year one.
Can ROI be negative? ▼
Yes. Negative ROI means a loss. $1,000 invested, now worth $800 → ROI = −20%. Negative ROI is common in early-stage startups, volatile crypto, or real estate in declining markets. It's a critical signal to reassess your position or exit strategy.
How do I calculate ROI on a rental property? ▼
Use cash-on-cash ROI: (Annual Net Cash Flow / Total Cash Invested) × 100. Annual net cash flow = all rent received minus all expenses (mortgage, taxes, insurance, maintenance, management fees, vacancy allowance). Total cash invested = down payment + closing costs + renovation budget.
How do I calculate stock ROI including dividends? ▼
Total Return = ((Sell Price − Buy Price) × Shares + Total Dividends − Fees) / (Buy Price × Shares + Fees) × 100. This gives you a complete picture: price appreciation plus dividend income, minus friction costs like commissions and taxes.
Does ROI account for inflation? ▼
Standard ROI does not adjust for inflation. To find your real (inflation-adjusted) return: Real ROI ≈ Nominal ROI − Inflation Rate. In a 3% inflation environment, a 7% nominal ROI yields roughly 4% real purchasing power gain. For multi-decade investments, this distinction is critical.
How do I calculate ROI on a marketing campaign? ▼
Marketing ROI = (Revenue Attributed to Campaign − Campaign Cost) / Campaign Cost × 100. The challenge is attribution — tracking which sales actually came from which campaign. Example: a $5,000 email campaign generated $23,000 in attributable revenue → ROI = ($23,000 − $5,000) / $5,000 × 100 = 360%. A 100%+ marketing ROI is generally considered good. Below 0%, the campaign cost more than it earned. Always account for the gross margin on sales, not just revenue, for a true profit-based ROI.
What is the difference between ROI and IRR? ▼
ROI is a simple ratio of profit to cost — it doesn't account for the timing of cash flows. IRR (Internal Rate of Return) is the annualized rate that makes the net present value of all cash flows equal zero, accounting for when money goes in and out. IRR is more sophisticated for projects with multiple cash flows over time (real estate, private equity, project finance). For simple one-time investments, ROI/CAGR is sufficient. For complex multi-year cash flow projects, use IRR.
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