Calculate return on investment, annualized ROI and net profit
An ROI calculator works out the return on an investment — the net profit expressed as a percentage of what you put in — so you can judge how well money or effort paid off. You enter the amount invested and the amount it returned, and it gives the net profit and the ROI percentage. ROI is the most common yardstick for comparing investments, projects or campaigns precisely because it is a ratio: a £500 gain means very different things on a £1,000 outlay versus a £50,000 one, and the percentage captures that in a single comparable number.
A raw profit figure tells you how much you made but not how efficient it was, which is exactly what ROI fixes. The one thing ROI alone leaves out is time, so this calculator also works out annualized ROI — the return scaled to a per-year rate — because 50% over five years is not the same as 50% in one. That distinction is essential when comparing opportunities of different lengths. This tool computes both in your browser, so the figures you enter stay private.
ROI is the net profit divided by the cost of the investment, expressed as a percentage. So a gain of 200 on a cost of 1,000 is 200 ÷ 1,000 = 20% ROI. The percentage form makes returns of different sizes directly comparable.
ROI is the total return over the whole holding period, ignoring how long that was. Annualized ROI converts it to an equivalent per-year rate, so a 50% total return over five years becomes a much lower annual figure. Use annualized ROI to compare investments held for different lengths of time.
Because the total ignores time. A 50% return is excellent in one year but mediocre spread over ten. Annualizing reveals the true yearly rate, which is why a big-looking total ROI can shrink once you account for how long it took to earn.
No — basic ROI compares return to initial cost only. It does not weigh risk, ongoing costs, taxes or inflation, all of which affect a real decision. Treat ROI as one important figure among several rather than the whole picture.
Loan Calculator · Tip Calculator · Discount Calculator · Compound Interest · VAT Calculator · Currency Converter