ROI Calculator
Calculate return on investment (ROI) as a percentage from the amount invested and the amount returned, plus the annualized return over the holding period.
Last updated: October 2026
Return on investment
20 %
Formula below · 3 sources (investopedia.com, corporatefinanceinstitute.com, openstax.org) · Updated Oct 2026
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About this calculator
Return on investment compares what you got back with what you put in:
ROI = (Amount returned − Amount invested) ÷ Amount invested × 100
Investing $10,000 and getting back $12,000 is a 20% ROI. The amount returned should include everything the investment paid you (sale proceeds plus dividends or interest received) minus fees and other costs.
Annualized ROI
Plain ROI ignores time: 20% in one year is far better than 20% over ten. Annualized ROI is the constant yearly rate that grows the investment to the same final value:
Annualized ROI = ((Amount returned ÷ Amount invested)^(1 ÷ years) − 1) × 100
20% over 3 years is 6.27% a year. This is the same as the compound annual growth rate (CAGR).
Limits
ROI uses one amount in and one amount out. If you added or withdrew money along the way, use an internal rate of return (IRR) or net present value calculation instead. ROI also says nothing about risk, taxes or inflation.
| Total ROI | 1 year | 3 years | 5 years | 10 years |
|---|---|---|---|---|
| 10% | 10% | 3.23% | 1.92% | 0.96% |
| 20% | 20% | 6.27% | 3.71% | 1.84% |
| 50% | 50% | 14.47% | 8.45% | 4.14% |
| 100% | 100% | 25.99% | 14.87% | 7.18% |
How to use
Enter the amount invested, the amount returned and how many years you held the investment, then choose total or annualized ROI. The default, $10,000 growing to $12,000 over 3 years, is a 20% total ROI or 6.27% a year. A $5,000 investment that returns $7,200 after 18 months (1.5 years): total ROI = 2,200 ÷ 5,000 = 44%; annualized = (7,200 ÷ 5,000)^(1 ÷ 1.5) − 1 = 27.52% a year. A result below zero is a loss: $10,000 returning $8,000 is −20%.
Frequently asked questions
How do I calculate ROI?
Subtract the amount invested from the amount returned, divide by the amount invested, and multiply by 100. $1,500 back on $1,200 invested is (1,500 − 1,200) ÷ 1,200 = 25%.
Why annualize ROI?
To compare investments held for different lengths of time. A 50% return over 10 years is only 4.14% a year, while 20% over 2 years is 9.54% a year.
Is ROI the same as IRR?
For a single amount in and a single amount out, annualized ROI equals the internal rate of return. When there are several cash flows at different times, only IRR or NPV accounts for when each one happened.
What counts as the amount returned for a marketing campaign?
The profit the campaign produced plus its cost, not the revenue. If $15,000 of ads produced $22,500 of sales with $9,000 of product cost, the gain is 22,500 − 9,000 − 15,000 = −$1,500, a loss, even though revenue exceeded the ad spend.
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