ROI = (final value − amount invested) ÷ amount invested × 100. It measures total gain relative to cost, whatever the time span. Because a 50% return over 2 years is very different from 50% over 10 years, the annualized return (CAGR) converts it to a yearly rate: CAGR = (final ÷ invested)1 ÷ years − 1.
Example: $10,000 grows to $15,000 over 4 years. Profit is $5,000, ROI is 50% and the annualized return is about 10.7% a year.
It depends on the risk and the time. Broad stock markets have historically averaged roughly 7 to 10% a year before inflation, but individual years vary widely.
Only if you include them: add fees to the amount invested, or subtract fees and taxes from the final value, to get a net figure.
This tool assumes one amount in and one amount out. For regular deposits use the compound interest calculator or savings goal calculator.
See also: compound interest calculator · percent change calculator · margin calculator
Planning a launch? See the break-even calculator.
Also: CAGR calculator.