ROI Calculator
Return on investment as %, profit and multiple.
ROI
50%
Profit/Loss
$500.00
Multiple
1.5×
How it works
ROI (Return on Investment) is one of the most widely used financial metrics in business. It answers a simple question: for every dollar invested, how much did I get back? Executives, investors, and analysts use ROI to compare projects, validate marketing campaigns, analyze stocks, and decide whether an investment was worth it.
Formula:
ROI (%) = (Final Value − Invested) / Invested × 100 Profit = Final Value − Invested Multiple = Final Value / Invested
Expressing the result as a percentage lets you compare investments of different sizes on the same scale. A 20% ROI means the investment returned 20% on top of the original capital. To compare with other options, always consider the time period: 20% over 6 months is very different from 20% over 5 years. To normalize, compute the annualized ROI: (1 + ROI)^(1/years) − 1.
ROI has important limitations. It ignores risk, doesn't distinguish recurring from one-time profits, and doesn't discount the time value of money (inflation, opportunity cost). For more rigorous analysis, also compute NPV (Net Present Value), IRR (Internal Rate of Return), or Payback Period. Even so, ROI remains the starting point of any financial assessment.
Practical examples
Stock bought for $1,000 and sold for $1,500
Profit $500 · ROI 50% · Multiple 1.5×
Business with $50,000 invested and $80,000 returned
Profit $30,000 · ROI 60% · Multiple 1.6×
Marketing campaign: spent $5,000, generated $4,000 in sales
Loss $1,000 · ROI −20% · Multiple 0.8×
Property bought for $300,000 and sold for $450,000 in 3 years
Profit $150,000 · ROI 50% (≈14.5% annualized)
Frequently asked questions
What is a good ROI?
It depends on sector, time horizon, and risk. In US Treasury bonds, 4–5% per year is considered safe. In stocks, 8–12% per year is the long-run S&P 500 average. In private businesses, ROIs above 20% per year are common to compensate for risk.
How is ROI different from profit margin?
Margin is calculated on revenue (profit/revenue); ROI is calculated on capital invested (profit/invested). A product can have a high margin but require lots of capital — meaning low ROI. The two metrics complement each other.
Should I include taxes in the ROI?
Yes — for a realistic analysis, use after-tax values. Investments with high tax burden (short-term capital gains, day-trading) may have an attractive gross ROI but mediocre net ROI.
Is a negative ROI always bad?
Not necessarily. In early-stage businesses, negative ROIs are expected. What matters is the projected ROI over the full horizon — a startup may show −80% ROI in year 1 and +500% by year 5.
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⚠️ Disclaimer
This calculator is for educational and informational purposes only. Results are estimates based on public formulas and may contain inaccuracies or be outdated. We are not accountants, lawyers, doctors, or financial advisors — for any important decision (tax filings, contracts, diagnoses, financial planning), always consult a qualified professional. calculadora.work assumes no liability for decisions made based on the content of this site.