How to use the ROI Calculator
- Enter the amount invested and the amount you got back (or the current value).
- Optionally enter how long you held the investment to see the yearly return.
Formula
ROI % = (Final value − Investment) ÷ Investment × 100
CAGR % = ((Final value ÷ Investment)^(1 ÷ years) − 1) × 100
Why annualised return matters
A 30% return sounds good, but over 2 years it's about 14% a year, and over 5 years it's only about 5.4% a year. ROI tells you the total result; CAGR lets you compare it with a fixed deposit, a loan rate or another project.
Worked example
₹2,00,000 grows to ₹2,60,000 in 2 years
- Gain = ₹60,000
- ROI = 60,000 ÷ 2,00,000 = 30%
- CAGR = (1.30)^(1/2) − 1 = 14.02% a year
30% total return, 14.02% a year
Important notes
- ROI ignores the timing of cash flows in between. For projects with many inflows and outflows, use IRR in a spreadsheet.
Frequently asked questions
What is a good ROI?
It depends on the risk and the alternatives. Compare the annualised return with what you could earn elsewhere at similar risk, and with your cost of borrowing.
Should I include income received during the investment?
Yes. Add dividends, rent or interest received to the final value for a complete picture.