ROI Calculator

Return on investment expresses what you gained as a percentage of what it cost you. That single normalization is why ROI survives every criticism leveled at it: it works on a stock, a rental property, or a training program with exactly the same arithmetic.

Total cost basis($)Purchase price plus commissions, fees and improvements.Ending value + income($)Sale proceeds plus any dividends or rent received.Years held(years)

Return on investment

17.50%

Net return: $1,400.00
Annualized ROI: 17.50%

Values update as you type. This calculator covers the single scenario its formula assumes — see Common Mistakes for what it leaves out.

The formula this calculator uses

ROI = (Current Value - Cost) / Cost x 100%

Current Value: What the investment is worth now, plus any income it paid along the way
Cost: Total cost basis: purchase price plus fees, closing costs and improvements
Net Return: Current Value - Cost (negative if the position lost money)
ROI: Net return as a percentage of cost

How to check the result by hand

1
Total every cost required to own the asset
Start with the purchase price and add commissions, closing costs, shipping, installation and improvements — anything you could not have avoided while acquiring it. This sum is the denominator, and understating it inflates ROI more than any other error here.
2
Total every return the asset produced
Sale price plus all interim income: dividends, rental receipts, interest, lease payments. If the asset is still held, use its current market value rather than what you paid for it — an unsold position still has a realizable value.
3
Subtract cost from value to get net return
This is the numerator and it can be negative. A $9,400 sale on an $8,000 basis gives $1,400; a $7,200 sale gives a −$800 net return, which is a legitimate and useful result rather than an error.
4
Divide by cost and convert to a percentage
$1,400 / $8,000 = 0.175, or 17.5%. Always divide by the cost basis, never by the sale price — dividing by the larger figure silently understates the return.
5
Annualize if you will compare it to anything
Raise (1 + ROI) to the power 1/t and subtract 1. Comparing a raw multi-year ROI against a one-year alternative is the single most common way this metric produces the wrong ranking.

For worked examples, common mistakes and the limits of this formula, read the full How To Calculate ROI page.