ROI calculator

What you put in, what you got back, and - if you tell it how long the money was tied up - the annualized rate that makes a 4-year return comparable to a 1-year one.

Amount invested ($)

Amount returned ($)

Years held (optional)

Optional - fill it in to get the annualized rate, the number that makes returns over different lengths comparable.

What is the difference between total and annualized ROI?

Total ROI is the simple one: gain divided by cost. Turn $50,000 into $65,000 and the ROI is 30.00% whether it took one year or ten. That is exactly why it misleads on its own - a 30% return over 4 years is a very different investment from 30% in one. The annualized figure fixes that: it is the single compound rate that would produce the same result over the same period, 6.78% per year in that example. When comparing investments held for different lengths of time, compare the annualized numbers.

What does this deliberately leave out?

ROI here is before tax, before inflation, and blind to risk - a 30% return from a lottery ticket and from a term deposit read identically. It also ignores cash flows along the way: if money went in or came out at different times, the honest metric is IRR, and the NPV & IRR calculator solves it from the actual dated flows.