How roi calculator works
Return on Investment (ROI) measures the profitability of an investment as a percentage. The basic formula is net profit divided by cost, times 100: ROI = (final value − cost) / cost × 100. A positive ROI means you made money; a negative ROI means you lost it.
Enter the initial investment (cost) and the current or final value. The calculator returns the net profit and the ROI percentage. If you also enter the holding period in years, it computes the annualized ROI using the geometric formula ((final / cost)^(1/years) − 1) × 100, which makes returns over different time spans directly comparable.
ROI is simple and widely used but ignores the timing of cash flows, risk, and the cost of capital. For investments with regular contributions or withdrawals, a time-weighted or internal-rate-of-return measure is more accurate. Use this tool for a quick, comparable profitability snapshot of a single buy-and-sell.