ROI Calculator
Return on investment, with an annualised figure only where it means something.
Figures you enter stay in the page. Nothing is uploaded or stored.
Return on investment is a single number standing in for a whole story, which is what makes it useful and what makes it easy to misread.
More about ROI Calculator
The arithmetic is simple: profit divided by what it cost, as a percentage. The part that trips people is what belongs in "what it cost". Fees, commission, the time spent, the thing that had to be bought alongside — leave those out and the return looks better than it was. There is a field for them here, and it is added to the initial investment rather than subtracted from the final value, because that is the honest denominator.
The annualised figure is where a real number most often becomes a misleading one. Compound annual growth answers "what steady yearly rate would have produced this", which is only meaningful over a year or more. Annualising a three-month return implies it would repeat four times, and quoting that as an annual figure is how a lucky quarter becomes a track record. This tool shows it only from a year, and says why when it does not.
None of this accounts for tax, inflation, or the risk taken to get the return. A 40% gain that could just as easily have been a 40% loss is not the same investment as a 10% gain that could not, and no single percentage will tell you which one you had.
- Additional costs added to the denominator, where they honestly belong
- Annualised return only from a year, with the reason stated when it is withheld
- A total loss reported as −100% rather than as an error
- Money formatted the way the page language writes it
- Impossible inputs refused with a reason, never shown as NaN
How to use it
- 1Enter what you put in and what it is worth now.
- 2Add any fees or costs that came with it.
- 3Add the holding period if you want the annualised figure.
- 4Read the return, the profit and the total cost.
Questions
How is ROI calculated?
Net profit divided by total cost, as a percentage. Total cost is the initial investment plus any additional costs you enter.
Why is there no annualised figure for my period?
Because it is under a year. Annualising a shorter period implies the return would repeat, which turns a lucky quarter into an apparent track record.
Should fees go in additional costs or come off the final value?
In additional costs. They are part of what the investment cost you, so they belong in the denominator rather than hidden in the result.
Does this account for tax or inflation?
No. Both would need rates that vary by person and place, so this is a gross return before either.
Is a higher ROI always better?
Not on its own. It says nothing about the risk taken or how long it took, and both change what the number is worth.