Return on investment compares what you got back with what you put in: profit divided by cost, as a percentage. It works for a marketing campaign, a new machine, a training course or a stock, which is exactly why it is the most quoted business metric. Enter the amount invested, any additional costs and the amount returned, and the calculator gives the net profit and the ROI; add the holding period and it also shows the annualized return so investments of different lengths can be compared fairly.
ROI Calculator
Return on investment is the simplest way to compare what you got back with what you put in. The ROI calculator takes the amount invested, any additional costs, and the amount returned. Investing $10,000 and getting $13,500 back is a $3,500 profit and a 35% return.
A plain ROI figure ignores time, which makes a 35% return over two years look identical to 35% over ten. Enter a holding period and the calculator also shows the annualized return, the compound annual growth rate that would produce the same result: 35% over two years is about 16.2% a year. Use the annualized figure whenever you compare investments held for different lengths of time.
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Frequently Asked Questions
What is the ROI formula?
ROI = (amount returned − total cost) ÷ total cost × 100. Getting $13,500 back on a $10,000 investment is a 35% ROI.
What is a good ROI?
It depends on the risk and the alternative uses of the money. Stock markets have returned roughly 7–10% a year over long periods; a business project is usually expected to beat that comfortably to justify the effort and risk.
Why show an annualized return?
Plain ROI ignores time: 35% over two years and 35% over ten years look identical. The annualized figure (a compound annual growth rate) converts both to a yearly rate so they can be compared.
