Return on Investment Calculator

Calculate potential returns on your investments with our advanced ROI calculator. Perfect for stocks, real estate, business investments, and more. Get instant visual results to help you make informed financial decisions.

Investment Details

USD
USD
%
Years
%

Investment Results

Total Invested
$34,000
Final Value
$57,234
ROI: 68.3%
Annual Growth: $2,323

Growth Visualization

Understanding ROI

What is ROI?

Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency of several different investments.

ROI tries to directly measure the amount of return on a particular investment, relative to the investment's cost. To calculate ROI, the benefit (or return) of an investment is divided by the cost of the investment. The result is expressed as a percentage or a ratio.

Why ROI Matters

Understanding ROI is crucial for making smart financial decisions. It helps investors determine which investment opportunities are most profitable and which should be avoided.

A positive ROI means the investment is profitable, while a negative ROI indicates a loss. Investors use this metric to compare the efficiency of different investments and make decisions about where to allocate their capital.

ROI Formula

ROI = [(Current Value of Investment − Cost of Investment) / Cost of Investment] × 100%

This simple formula helps you understand exactly how much profit (or loss) your investment has generated relative to its cost.

Frequently Asked Questions

What is a good ROI percentage?

A "good" ROI varies by investment type, risk tolerance, and market conditions. Generally:

  • 7-10% is considered good for stock market investments
  • 15-20% might be expected for a successful business venture
  • Real estate often aims for 8-12% ROI

Always compare to relevant benchmarks and consider risk factors.

How does inflation affect ROI calculations?

Inflation reduces the purchasing power of money over time, which means your nominal ROI might look higher than your real ROI. Our calculator provides both:

  • Nominal ROI: The return without adjusting for inflation
  • Real ROI: The return adjusted for inflation (what really matters)

Always consider real returns when evaluating long-term investments.

Can I use this calculator for cryptocurrency investments?

Yes, absolutely! Our ROI calculator works for any investment type where you can estimate:

  • Initial investment amount
  • Regular contributions (if any)
  • Expected annual return rate
  • Investment time horizon

Keep in mind that cryptocurrency tends to have higher volatility, so consider using conservative estimates for long-term planning.

How accurate are the projections?

Our calculator provides projections based on the inputs you provide. Important considerations:

  • Returns are compounded annually
  • Projections assume consistent returns (real-world returns fluctuate)
  • Doesn't account for taxes, fees, or investment costs
  • Inflation adjustment is approximate

Use these projections for planning purposes, but consult a financial advisor for personalized advice.