Calculate total and annualized ROI net of fees, then compare two investments fairly even when their holding periods differ.
Everything you put in, and everything you got back.
Estimates for comparison only, based on the figures you enter. Past returns do not predict future results. This is not investment advice.
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Work out what an investment actually returned. Enter what you put in, what you got back, and how long you held it, and this calculator gives you total ROI, the annualized rate, net profit after fees, and where that annual return sits against common benchmarks. Switch to compare mode to put two investments side by side, and see which one really won once their different holding periods are accounted for.
ROI is net profit divided by total cost, expressed as a percentage. Net profit is everything you got back — the final value plus any income such as dividends, rent or coupon payments — minus everything the investment cost you, which includes the purchase price plus commissions, advisory fees and closing costs. A total ROI of 80% means you ended up with 80 cents of profit for every dollar of cost. It says nothing about how long that took, which is why the annualized rate matters just as much.
ROI formula
Combine the price gain with the dividends you collected and the commissions you paid to get the real return on a position you have sold or still hold.
Rental property returns depend on years of net rent as much as the sale price. Enter both, along with closing and selling costs, for a figure that reflects the whole deal.
Compare mode annualizes both sides, so a large slow gain and a small fast one are judged on the same basis.
Any spend with a measurable payoff — equipment, a renovation, a course — can be evaluated as cost in, value out, over a period.
Commissions, advisory fees and closing costs belong in the cost basis. Leaving them out flatters every return you calculate, and the effect is largest on small positions and on property.
Dividends, rent and interest are money the investment paid you. Counting only the price change understates the return on income-producing assets, sometimes by a wide margin.
A 50% total return is excellent over two years and poor over twenty. The annualized rate strips the holding period out so two investments can actually be compared.
Comparing a long-held position against a recent one on total ROI alone always favours the older one. Annualizing removes that bias.
Knowing your return is 6% a year only helps if you know what 6% is relative to cash, inflation and typical market returns.
It depends entirely on the risk you took and how long your money was tied up. As a rough frame of reference, an annual return below about 3% barely keeps ahead of cash, 7% to 12% is in the range of long-run broad stock market averages, and anything above 20% a year sustained over many years is rare. A 12% return on an index fund and a 12% return on a single speculative stock are not equally good, because the second one carried far more risk for the same result.
As an annual return, 4.5% is modest: comfortably ahead of a savings account, close to what high-grade bonds have paid, and below the long-run average for broad stock market investments. For a low-risk holding it is a reasonable result. For something volatile, it is poor compensation for the risk. As a total return rather than an annual one, 4.5% is only good if you earned it quickly — 4.5% over three months is an excellent pace, and 4.5% over ten years is a loss after inflation.
A 7% return means you earned 7 cents of profit for every dollar the investment cost you. If that is an annual rate, your money roughly doubles every ten years through compounding. If it is a total return, you need the holding period before it means anything: 7% over one year is solid, while 7% over five years works out to about 1.4% a year, which is close to standing still.
Total ROI is the whole gain over the whole period, with no reference to time. Annualized ROI is the compound rate that would produce that same result year after year. An investment that doubles has a 100% total ROI whether it took two years or twenty, but the annualized figures are about 41% a year and 3.5% a year — completely different investments described by the same total.
Yes, both. Regulators describe the first step in calculating a return as determining the total cost of the investment, including the price you paid and any investment fees — commissions, markups or advisory charges. Income the investment pays you belongs on the other side of the equation. Omitting fees overstates your return, and omitting income understates it on anything that pays dividends, rent or interest.
No. Everything this calculator reports is a nominal return, in the currency amounts you entered. To get a real return, subtract the inflation rate over the same period from the annualized figure. A 5% annual return during a stretch of 3% inflation is closer to 2% in purchasing power.
Compare their annualized returns, not their totals. Compare mode does this automatically: it annualizes both investments and picks the winner on that basis. A 30% gain over 18 months beats a 100% gain over seven years, because the first compounds at roughly 19% a year and the second at about 10%.
ROI has no way to record when each deposit was made, so a contribution added halfway through the period would be treated as if it had been invested from day one, which understates the annual rate. When money goes in and out at different times, the correct measure is the internal rate of return. Use the IRR calculator for those cases.