How do I compare investments with different time periods?

Use CAGR (annualized ROI). An investment with 50% return over 5 years (8.4% CAGR) underperformed one with 30% return over 2 years (14% CAGR), even though total return was higher.

Should I include dividends in ROI?

Yes! Total return includes both price appreciation and dividends. A stock that rose 5% but paid 3% in dividends actually returned 8%. Dividends are especially important for income-focused investments.

The S&P 500 historically returns about 10% annually. Beating this benchmark consistently is considered good. But compare like with like—different asset classes have different expected returns and risks.

Does ROI account for inflation?

Standard ROI is nominal (not adjusted). Real ROI subtracts inflation. If you earned 8% but inflation was 3%, your real ROI was about 5%. For long-term planning, real returns matter more.

Finance

ROI Calculator

Calculate ROI percentage, annualized returns (CAGR), and total gains on your investments including dividends

Initial Investment

Final Value

Investment Period (Years)

years

Additional Contributions

Dividends/Income Received

Made with love

Support

Related Calculators

You might also find these calculators useful

Compound Interest Calculator

Calculate compound interest growth over time

Investment Return Calculator

Calculate ROI and CAGR on investments

401k Calculator

Project your 401k retirement savings

Boat Loan Calculator

Calculate your monthly boat payment

Calculate Your Investment Returns

How well did your investment perform? Our ROI calculator shows total return percentage, annualized ROI (CAGR), and absolute gains. Compare investments of different sizes and time periods to see which performed better.

Understanding ROI and CAGR

ROI (Return on Investment) shows total percentage gain or loss. CAGR (Compound Annual Growth Rate) annualizes the return for fair comparison across different time periods. An investment that doubles in 10 years has 100% ROI but only 7.2% CAGR.

ROI Formula

ROI = (Final Value - Initial Investment) / Initial Investment × 100

How to Calculate ROI

Common Use Cases

Stock Investment

Track portfolio performance including capital gains and dividends.

Real Estate

Calculate returns including appreciation, rental income, and costs.

Business Investment

Evaluate project returns and compare investment opportunities.

Retirement Accounts

Monitor 401k and IRA performance over time.

Frequently Asked Questions

ROI shows total return regardless of time. CAGR shows what annual return would produce the same result if compounded yearly. A 100% total ROI over 10 years equals 7.2% CAGR—very different perspectives on the same result.