ROI Calculator
Return on investment (ROI) measures the gain or loss from an investment relative to its cost. It is usually expressed as a percentage: (Gain − Cost) / Cost × 100. Use this calculator when you know how much you invested and how much you received (or expect to receive)—ideal for comparing projects or reviewing past investments.
Calculate ROI
How it works
ROI = ((Final value − Cost) / Cost) × 100. If the result is positive, you have a gain; if negative, a loss. The formula does not account for the time period—a 25% return in one year is very different from 25% over ten years. For time-weighted comparison, use annualized return or other metrics.
Example: You invest $10,000 and the investment is now worth $12,500. Gain = $2,500. ROI = (2,500 / 10,000) × 100 = 25%. If you had sold for $8,000, the gain would be −$2,000 and ROI = −20%.
Practical use cases
Use ROI to compare different uses of capital, evaluate marketing spend, or review stock and real estate performance. Include all relevant costs (fees, taxes) in the cost and net proceeds in the final value. ROI alone does not capture risk or time—combine it with other metrics when making decisions.
Frequently asked questions
- What is a good ROI? It depends on risk and asset class. Stocks historically average around 7–10% per year; higher returns usually imply higher risk. Compare to your cost of capital.
- Can ROI be negative? Yes. If the final value is less than the cost, the gain is negative and ROI is negative, indicating a loss.
- Should I include fees in the cost? For accuracy, include all costs (purchase fees, commissions) in the investment cost and any selling costs as a reduction of proceeds.