ROI Calculator
Return on investment is the profit as a percentage of the cost: investing 1000 and getting back 1250 is an ROI of 25 %.
25 %
- Net profit
- 250.00
- Annualised ROI
- 11.8034 %
Step-by-step solution
- ROI = (Final value − Cost) ÷ Cost × 100 %
- ROI = (1,250.00 − 1,000.00) ÷ 1,000.00 = 25 %
ROI Formula
ROI = (Final value − Cost) ÷ Cost × 100 %
Final value: total amount returned; Cost: amount invested
Worked Example
Investing 1000 and getting back 1250 after 2 years:
- ROI = (Final value − Cost) ÷ Cost × 100 %
- ROI = (1,250.00 − 1,000.00) ÷ 1,000.00 = 25 %
Annualised ROI: 11.8034 %
ROI, annualised ROI and their limits
ROI is net gain divided by cost: a return of 250 on 1000 is 25 %. Because it ignores time, compare investments of different lengths using the annualised ROI, (1 + ROI)^(1/t) − 1. ROI also ignores risk and the timing of cash flows inside the period; for projects with several cash flows, NPV or IRR gives a fairer comparison. Make sure costs include everything spent, such as fees, taxes and running costs.
Frequently asked questions
What is annualised ROI?
The yearly rate that compounds to the total return: (Final ÷ Cost)^(1/years) − 1. A 25 % return over 2 years is about 11.8 % a year.
What is a good ROI?
It depends on risk and time: compare ROI with what a safer alternative would earn over the same period. A one-year ROI of 7–10 % is often quoted for diversified stock investments.
What is the difference between ROI and ROE?
ROI measures the return on a specific investment; ROE is a company ratio: net income divided by shareholders’ equity.
Sources
Last reviewed: . Factors are stored exactly and computed with 50-digit decimal arithmetic. See how we verify conversion factors.
Cite this page
APA
Scientific Converters. (2026, October 15). ROI Calculator. Retrieved October 25, 2026, from https://scientificconverters.com/calculators/roi-calculator/
IEEE
Scientific Converters, "ROI Calculator," scientificconverters.com. Accessed: Oct. 25, 2026. [Online]. Available: https://scientificconverters.com/calculators/roi-calculator/