ROI Calculator (with CAGR)

Measure any investment's performance: total return on investment, absolute gain, and — if you enter the holding period — the annualized return (CAGR), which is the only fair way to compare investments held for different lengths of time.

How to use this calculator

Enter the amount you invested (include purchase costs for honesty).
Enter the current or sale value.
Add the holding period in years to unlock the annualized (CAGR) figure.
Compare investments by CAGR, never by total ROI alone.

Formula used

ROI = (Final − Invested) ÷ Invested × 100 · CAGR = (Final ÷ Invested)^(1/years) − 1

Total ROI ignores time — a 60% return sounds great until you learn it took 15 years. CAGR converts any result into the equivalent steady annual growth rate, making apples-to-apples comparison possible.

Example calculation

Worked example

Invested 100,000, now worth 165,000 after 4 years:

Total ROI = 65%. CAGR = (1.65)^(1/4) − 1 = 13.34% per year — comfortably ahead of an FD, behind a great equity run.

ROI vs CAGR — using them right

ROI is the total percentage gained or lost on the money you put in — simple, universal, and blind to time. CAGR (compound annual growth rate) fixes that by expressing the result as one steady yearly rate, as if the investment had grown smoothly.

For fair analysis, also count all cash flows: purchase fees, maintenance, taxes and dividends. Property ROI in particular flatters itself when stamp duty, upkeep and selling costs are quietly left out.

Why use this calculator?

Judge any investment — stocks, property, gold, a business — on one comparable scale.
Convert multi-year results into annual rates you can compare with FD or index returns.
Spot when an impressive total return is actually mediocre per year.

Frequently asked questions

What is a good ROI?

Context is everything: beating inflation is the floor, beating a fixed deposit (~6–7%) shows the risk paid off, and beating a broad equity index (~10–12% long-run) means you outperformed the easy alternative. Judge by CAGR against those benchmarks.

How is CAGR different from average return?

Averaging yearly returns overstates results because losses hurt more than equal gains help (+50% then −50% averages to 0% but leaves you down 25%). CAGR uses the actual start and end values, so it reflects what really happened.

Should I include dividends and rent in ROI?

Yes — total return includes all income received plus price change, minus all costs. Ignoring income understates ROI; ignoring costs overstates it.