Return on Investment (ROI) Calculator
Easily assess the returns on your investments
Updated on: Monday, September 1, 2025
Use the Calaendo ROI Calculator to unlock the full potential of your financial decisions. This tool enables you to gauge the profitability of your investments, gain valuable insights and make informed financial choices.
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Know More →What is ROI?
ROI stands for 'Return on Investment,' which is a financial metric used to measure the profitability or effectiveness of an investment. In simple terms, it tells you how much profit or value you gained (or lost) relative to the amount of money you initially invested.
You can calculate ROI using the simple formula, ROI = Net profit/Cost of investment * 100. If you are investing in property, then the return on investment will show you how profitable that investment is. If you are investing in the stock market, the ROI tells you how much you are gaining.
How Does ROI Calculation Help You?
ROI calculation is useful for evaluating the profitability and suitability of an investment. Considering ROI as per an individual's financial goals and risk tolerance can enable investors to make the right decisions.
Determine Profitability
Gauge potential profitability and ascertain whether an investment aligns with your financial goals.
Quantify Returns
Use ROI as a standardized metric to compare the returns of different investments, facilitating prioritization.
Account for Risk
Considering risk tolerance alongside ROI helps evaluate the level of risk you are comfortable taking.
Address Long-Term Goals
Valuable for long-term financial planning, helping identify investments with compounding potential.
Absolute vs. Annualized ROI
Absolute ROI Formula
Absolute ROI shows performance over a period, typically less than a year. The formula is:ROI = (Net Profit / Initial Investment) * 100
Annualized ROI Formula
Annualized ROI provides the yearly rate of return, accounting for compounding. The formula is:Annualized ROI = [(Ending Value / Beginning Value) ^ (1 / Years)] - 1
Use Cases for ROI Calculation
Real Estate
Compare two properties to see which offers a better return percentage, even if the absolute profit differs. This helps in making informed purchase decisions based on capital growth potential versus initial cost.
Mutual Funds
Assess different funds by comparing their ROI against their risk level. An investor can choose a fund that aligns with their personal risk appetite, whether it's a high-risk, high-return equity fund or a low-risk debt fund.
What is a Good ROI?
A "good" ROI is subjective and depends on risk tolerance, investment horizon, and financial goals. In the stock market, an average annual return of 10% is often considered good, benchmarked against historical index performance like the S&P 500 or Nifty 50.
Ask yourself: How much risk can I take? What's my target profit? Am I investing for the long-term? What is the opportunity cost?
Benefits of using ROI Calculator
Our ROI calculator empowers you to make smarter financial decisions with confidence.
Efficiency
Quickly evaluate investments, saving time and effort.
Objectivity
Data-driven calculations reduce emotional bias for objective decisions.
Comparison
Easily prioritize investments based on potential returns.