Calculate the percentage gain or loss relative to an investment cost. ROI is a simple profitability measure and can compare an initial outlay with total proceeds. It is not annualized and does not measure risk, liquidity or the time taken to earn the return.
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Before you enter your numbers
Enter all relevant initial costs and a return value representing total proceeds, not profit alone. Decide how transaction charges and operating costs will be treated, and use the same convention across comparisons. Do not subtract a cost twice by including it in both fields.
- Investment cost
- Final value or return received
Formula and calculation method
Net gain = return value − cost. ROI = net gain / cost × 100. Return multiple = return value / cost. The denominator must be greater than zero; a zero-cost opportunity does not have a finite ROI under this formula.
Worked example
An outlay of 8,000 with total proceeds of 10,000 produces a 2,000 gain, a 25% ROI and a 1.25× return multiple. If proceeds are 6,000, the loss is 2,000 and ROI is −25%. These figures contain no information about the holding period.
How to interpret the result
The result panel reports ROI percentage, net gain and return multiple.
A 25% return over one year and the same return over ten years have very different annual growth rates. Use the investment-return calculator when duration matters. Borrowing can change the return on your equity and adds repayment risk, neither of which is automatically captured here.
How ROI is calculated
ROI equals net gain divided by investment cost. If an investment costs 10,000 and ends at 13,000, the net gain is 3,000 and ROI is 30%.
ROI does not account for how long the investment was held. For investments held over different periods, use the Investment Return Calculator to compare annualized returns as well.
Set the cost boundary before comparing projects
For a property or business project, a purchase price may be only part of the money committed. Repairs, transaction fees and operating costs can change profitability. Decide whether they enter the cost base or reduce proceeds, then apply the same definition to every candidate.
ROI also ignores the scale of the gain. A 50% return on a small outlay can deliver less money than a lower percentage on a larger project. Consider absolute gain alongside percentage return, duration and downside risk rather than ranking opportunities by one percentage.
Use ROI for a simple gain ratio, not as a substitute for time-adjusted return
ROI answers how much gain or loss occurred relative to cost. It does not account for how long the investment was held. A 20% ROI earned in one year and a 20% ROI earned in ten years have the same ROI but very different annualized performance.
Include all relevant costs when possible. Transaction fees, renovation costs, marketing costs or other cash outlays can materially change ROI. If timing matters, use an annualized-return or cash-flow-based method in addition to ROI.
Use The Result In The Next Calculation
ROI is a simple gain-to-cost ratio and does not adjust for time. If holding period matters, use the investment return calculator or CAGR-style annualization before comparing projects with different durations.
Retirement planning guides · Calculation methodology
Rules and limits can change. Use these primary sources to verify time-sensitive details.
ROI Calculator FAQs
Should I enter revenue or profit as return value?+
Enter total money returned under the chosen cost convention. If you enter profit alone, the calculator subtracts the initial cost again and understates the result.
Where can I check the assumptions behind this result?+
Check the formula and limitations sections on the ROI Calculator page for the assumptions specific to this tool. The methodology page explains conventions shared across calculators, and Investor.gov investing resources is the reference for any time-sensitive statutory or product rule mentioned here.
What does the ROI Calculator result include?+
The result focuses on ROI percentage, net gain and return multiple. It is calculated from the inputs shown on this page rather than from live account, market or government data. Read the formula and limitations section before transferring the result into another planning tool.
What should I change when testing another ROI Calculator scenario?+
Change one major assumption at a time so you can see what drives the result. Useful inputs to test include Investment cost, Final value or return received. Use a conservative case alongside your central estimate rather than relying on only the most favorable combination.
Can the ROI Calculator replace an official statement or professional advice?+
No. It is a planning calculator. ROI ignores timing unless you add it separately. For investments held for different periods, annualized return is often more informative. Use official statements and current rules when an exact legal, tax, pension or account figure is required.