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ROI Calculator

Measure the total return on an investment and its annualized return over a holding period in years or between two dates.

Level: Grades 7–9

  • Common Core standard 7.RP.A.3Use proportional relationships to solve multistep ratio and percent problems. Examples: simple interest, tax, markups and markdowns, gratuities and commissions, fees, percent increase and decrease, percent error.
Printable worksheet

ROI Calculator

Know the answer you need? Pick an input to work backward.

Inputs

Everything you got back or still hold: what you sold it for, plus any income you received.

Holding period

Result

Total ROI

50%

Turning $10,000.00 into $15,000.00 is a 50% total return, or 8.45% a year over 5 years.

Annualized ROI
8.45%
Gain
$5,000.00
Holding period
5 years

See the step-by-step solution ↓

Step-by-step solution

  1. Find your gain: what came back minus what you put in

    $15,000.00−$10,000.00=$5,000.00

  2. Find the ROI: the gain as a percent of what you put in

    $5,000.00$10,000.00×100=50%

  3. Find how many times your money grew: what came back divided by what you put in

    $15,000.00$10,000.00=1.5

  4. Find the steady yearly rate that gives the same growth. Raise the growth to the power 1 ÷ years, take away 1 and make it a percent

    1.515−1×100=8.4472%

Test yourself

20 quick questions built from this calculator's formula: work out results, predict what happens when an input changes, and work backward from an answer. Every answer comes with the working.

Please note: Results are estimates for planning and comparison. Lenders, banks, and tax authorities may round differently or include fees not modeled here, so confirm figures with your provider before deciding.

What this calculator does

See how much an investment really earned you, in total and per year. Return on investment (ROI) answers one question: for every dollar you put in, how much came back? It works for stocks, a rental property, new equipment, a marketing campaign, or anything else where money goes in and value comes out.

A total ROI on its own can mislead you. Earning 50% in one year is very different from earning 50% over ten. So this calculator gives you the total ROI and the annualized ROI. The annualized ROI is the steady yearly rate that would give the same result over the time you held the investment.

Where it's used

Why this math matters outside the classroom:

  • Simple return. An investment of $1,000 that comes back as $1,500 has a 50% return on investment.
  • Annualized return. That same 50% earned over 3 years works out to about 14.47% a year compounded.
  • Marketing campaigns. A business compares the profit a campaign brought in with what the campaign cost.
  • Home improvements. Owners compare what a project cost with how much it is expected to add to the home's value.

Grade level and standards: Grades 7–9; Common Core State Standards for Mathematics 7.RP.A.3. © Copyright 2010. National Governors Association Center for Best Practices and Council of Chief State School Officers. All rights reserved.

How to use it

  1. Enter the amount you invested, including purchase fees and any extra money you added.
  2. Enter the amount returned: the final value, plus any dividends, rent or other income you received.
  3. Enter how many years you held it, or enter the date you invested and the date of return.
  4. Read the total ROI, the annualized ROI and the gain or loss in dollars.

What the inputs mean

Amount invested
The total cost of the investment. It must be more than zero.
Amount returned (final value)
Everything the investment produced: what you sold it for or what it's worth now, plus income you got along the way. Enter 0 if you lost it all.
Years held
How long the money was invested. Fractions are fine: 18 months is 1.5 years.
Date invested
The date you invested the money. With dates, the time held is the number of days between them divided by 365.

Formula and method

gain = amount returned − amount invested
ROI % = gain ÷ amount invested × 100
annualized ROI % = ((amount returned ÷ amount invested)^(1 ÷ years) − 1) × 100
years from dates = days between the dates ÷ 365

In the formulas, "^(1 ÷ years)" means raising a number to the power of 1 divided by the years held. For 5 years, that's the fifth root. Total ROI compares your gain with what you put in, without looking at time.

Annualized ROI assumes your money grew at the same rate each year, with each year's growth building on the last (compounding). It finds that rate. It's worked out the same way as a compound annual growth rate (CAGR).

When you enter dates, the calculator counts actual calendar days and divides by 365. So a period that includes a leap day comes out slightly longer than a whole number of years.

Worked example

You invest $10,000 and five years later the investment, with income received, is worth $15,000.

  1. Gain: $15,000 − $10,000 = $5,000.
  2. Total ROI: $5,000 ÷ $10,000 × 100 = 50%.
  3. Growth: $15,000 ÷ $10,000 = 1.5.
  4. Annualized ROI: (1.5^(1/5) − 1) × 100 = 8.45% a year.

Result: The total ROI is 50%. That works out to an annualized return of about 8.45% a year.

Understanding the result

Use annualized ROI to compare investments held for different lengths of time. A 30% total return over two years (about 14.02% a year) beats 50% over five years (about 8.45% a year).

For periods shorter than a year, the annualized number assumes the same pace keeps going all year. So a quick gain can look very large. Treat short-period annualized numbers with care.

A negative ROI is a loss. An ROI of −100% means everything you invested was lost.

Assumptions and limitations

  • All the money goes in at the start and comes out at the end. Annualized ROI assumes steady yearly compounding between those two points.
  • Dates are turned into years using a 365-day year (actual days ÷ 365).
  • Inflation, taxes and fees aren't taken out unless you include them in the amounts you enter.
  • Nothing is rounded during the math. Percents are shown to two decimal places.
  • If you added or took out money partway through, this simple ROI and its yearly version are only estimates. A measure that tracks the timing of each payment, such as internal rate of return (IRR), handles that better.
  • ROI ignores risk. Two investments with the same ROI can have very different chances of losing money.
  • Past returns don't predict future results.

Frequently asked questions

What is the difference between ROI and annualized ROI?

ROI is the total percent gain over the whole time. Annualized ROI turns that gain into a matching steady yearly rate, with compounding. Over exactly one year, they're the same.

Is annualized ROI the same as CAGR?

The formula is the same: the growth raised to the power of 1 ÷ years, minus 1. CAGR is the usual name when you describe how something like revenue or a portfolio grew. Annualized ROI is the name used when the starting value is money you invested.

Should I include dividends or rent?

Yes. Add any income you received to the amount returned, because leaving it out makes the return look smaller than it was. In the same way, include purchase costs and fees in the amount invested.

Why is my annualized return so high for a short holding period?

Annualizing assumes the same pace would continue for a full year, with compounding. A 10% gain in six months annualizes to 21%. That's a math projection, not a forecast.

How this calculator is checked

Method: Standard ROI definition, (return − investment) ÷ investment; annualized return as the geometric (compound) annual rate, (return ÷ investment)^(1/years) − 1. The calculation is covered by automated tests with known reference values and edge cases. Last updated 2026-10-18. Found a problem? Tell us.

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