Investment Return Calculator

Understanding your investment returns is essential for evaluating performance, comparing investment options, and making informed financial decisions. Whether you're investing in stocks, bonds, real estate, or other assets, knowing your ROI and annualized return helps you assess if your investments are meeting your goals.

This free investment return calculator helps you calculate ROI (Return on Investment) and annualized returns from your investment data. It shows you total gains, return percentages, and helps you compare different investments on an equal basis.

Use this tool to evaluate past investments, compare different investment options, and understand how your portfolio is performing relative to your goals and benchmarks.

Follow these steps to calculate your investment returns:

1. 1

   Enter Initial Investment

   Input the amount you initially invested. This is your starting principal or purchase price.

2. 2

   Enter Final Value

   Enter the current or final value of your investment. Include all gains: price appreciation, dividends, interest earned.

3. 3

   Enter Investment Period

   Specify how many years you held the investment. This is used to calculate annualized return for comparison purposes.

4. 4

   Enter Additional Contributions (Optional)

   If you made additional contributions during the investment period, enter the annual amount. This adjusts the ROI calculation.

5. 5

   Review Your Returns

   See your total ROI, annualized return, total gain, and total contributions. Compare these metrics to evaluate investment performance.

ROI (Return on Investment): Measures total return as a percentage of your investment cost. Formula: ((Final Value - Total Cost) / Total Cost) × 100. A 50% ROI means you earned 50% on your investment.

Annualized Return: Shows the average yearly return rate, making it easier to compare investments of different time periods. Formula: ((Final Value / Initial Value)^(1/Years) - 1) × 100. This accounts for compounding.

Example: $10,000 investment that grows to $15,000 over 5 years has a 50% ROI and approximately 8.45% annualized return. The annualized return is more useful for comparison because it standardizes returns to a yearly basis.

1. Compare to Benchmarks

Compare your returns to relevant benchmarks (S&P 500 for stocks, bond indices for bonds). This helps you assess if your investments are performing well relative to the market.

2. Consider Risk-Adjusted Returns

Higher returns often come with higher risk. A 15% return with high volatility may be worse than a 10% return with stability. Consider risk when evaluating returns.

3. Use Annualized Returns for Comparison

When comparing investments of different time periods, use annualized returns rather than total ROI. This gives you an apples-to-apples comparison.

4. Include All Costs

For accurate returns, include all costs: fees, commissions, taxes, and expenses. These reduce your actual returns and should be factored into calculations.

5. Focus on Long-Term Returns

Short-term returns can be volatile and misleading. Focus on long-term performance (5+ years) to get a true picture of investment quality. Avoid making decisions based on short-term fluctuations.