ROI Calculator

Simple ROI answers total gain. CAGR answers per year

A 50% gain in three years is not a 50% annual return. Simple ROI tells you how much capital grew (or shrank) in total. Annualized ROI, the CAGR equivalent on this page, is the constant yearly rate that compounds the initial amount to the final amount over the holding period. Use simple ROI for a one-line score. Use CAGR to compare a 18-month flip with a 5-year hold.

Defaults: $10,000 invested, $15,000 final value, 3 years. Net profit = 15,000 - 10,000 = $5,000.00. Simple ROI = 5,000 / 10,000 x 100 = 50.00%. CAGR = (15,000 / 10,000) ^ (1 / 3) - 1 = 14.47%. The primary card shows 50.00% with a green Profit badge. Copy writes initial, final, years, net, simple ROI, and CAGR.

Net = final - initial
Simple ROI % = (net / initial) x 100
CAGR % = [(final / initial) ^ (1 / years) - 1] x 100

Initial investment must be greater than 0. A zero denominator is not a return. The initial field gets aria-invalid="true", an assertive alert is announced, and copy is disabled. Duration is 0.1 to 50 years in 0.5 steps. Final value may be 0 (a total loss): simple ROI is -100%, and CAGR is -100%.

Losses must calculate, not crash the layout

If final value is below initial, net is negative and both percents are negative. The primary card uses a rose border and a Loss badge. Nothing jumps, nothing hides the other KPIs. Example: $10,000 to $8,000 in 3 years. Net = -$2,000. Simple ROI = -20.00%. CAGR = (0.8) ^ (1/3) - 1 ≈ -7.17%. That is still a valid result you can paste into a memo.

CAGR assumes a single lump at t=0 and a single value at t=years. Additional contributions, dividends taken as cash, and management fees are invisible unless you adjust the two dollar boxes. A rental with cash flow belongs in a different model (yield plus appreciation). This page is the two-point snapshot: money in, money out, time between.

Taxes are not subtracted. A 50% nominal gain that is short-term ordinary income is not a 50% keep. If you need after-tax ROI, put the after-tax final value in the second box. Inflation is also omitted: 14.47% CAGR in a 3% inflation year is not 14.47% real. Subtract inflation yourself if that is the question you are asking.

Where ROI sits next to ROAS and break-even

Ad spend uses the ROAS Calculator: revenue over ad dollars, not a multi-year compound rate. A product line that has not covered overhead yet belongs on the Break-Even Calculator. Use this ROI page when you have (or expect) two capital values and a clock. A $10,000 tool purchase that is "worth" $15,000 of saved contractor time in year three is the same arithmetic as a stock, with the same honesty requirement on the final number.

Recalculate when the mark or the exit price changes, not every tick. The copy summary is for an investor update or a partner email. It is not a performance report under any regulatory standard. If initial is blank, fix that first: no percent exists without a base.

A three-year 50% simple gain is 14.47% CAGR. Stretch the same $10,000 to $15,000 over 10 years and simple ROI is still 50.00%, but CAGR falls to 4.14%. That is why duration is a required input, not a footnote. Short holds look heroic on simple ROI and ordinary on CAGR. Long holds do the reverse. If you add capital at year two, this formula will lie: compute two legs or use a spreadsheet with cash flows. Final value of $0 over any positive duration is a full loss: both percents print -100.00% and the Loss badge stays on.

Frequently Asked Questions (FAQ)