ROI calculator
Cost in, value out: total return in dollars and percent, plus the annualized rate if you tell it how long you held.
Frequently asked questions
How is ROI calculated?
Gain divided by cost: (final value - amount invested) / amount invested x 100. Turning $10,000 into $14,000 is a 40% ROI regardless of how long it took.
Why does annualized return matter more than total ROI?
Because time is the whole game: 40% over two years is excellent (18.3% per year), while 40% over fifteen years is mediocre (2.3% per year). CAGR = (final/initial)^(1/years) - 1 puts every investment on the same per-year footing.
Does this account for added or withdrawn money?
No, it assumes one lump sum in and one value out. If you added money along the way, the true time-weighted return needs each cash flow dated; this gives the simple version.
What is a good annualized return?
The US stock market has averaged around 10% per year before inflation over the long run. Anything consistently above that involves either luck, leverage, or risk you should understand.