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ROI Calculator

Calculate the ROI (return on investment) for any investment, business, or project. Enter your initial investment and either the final value or the net profit earned, and optionally a time period to also see the annualized ROI.

How it works

  1. Enter the amount of your initial investment.
  2. Choose whether you'll enter the investment's 'final value' or its 'net profit' directly.
  3. Fill in the corresponding field with whichever figure you have available.
  4. Optionally, enter how long the investment lasted (in months or years) to see the annualized ROI.
  5. ROI, net profit, and annualized ROI update automatically as you type.

Use cases

  • Evaluating whether a financial, real estate, or business investment was profitable.
  • Comparing the performance of different investments with different time periods using annualized ROI.
  • Justifying investment decisions to partners or investors with a clear figure.
  • Measuring the return on internal projects, campaigns, or asset purchases.

Use cases

  • Evaluating whether a financial, real estate, or business investment was profitable.
  • Comparing the performance of different investments with different time periods using annualized ROI.
  • Justifying investment decisions to partners or investors with a clear figure.
  • Measuring the return on internal projects, campaigns, or asset purchases.

Common mistakes

  • Entering the investment's final value and treating it as if it were the net profit directly, without subtracting the initial investment.
    When you choose 'final value' mode, the calculator automatically subtracts the initial investment to get the real net profit before calculating ROI.
  • Comparing the simple ROI of two investments with very different terms (for example 20% in 6 months versus 20% in 3 years) as if they were equally good.
    Enter the time period for each investment so the tool also calculates the annualized ROI, which lets you fairly compare investments with different durations.
  • Expecting to see an annualized ROI when the recorded loss equals or exceeds 100% of the initial investment.
    In that case the calculation would require the root of a negative number, which isn't mathematically possible; the calculator simply omits the annualized ROI instead of showing an incorrect value.

Frequently asked questions

ROI (%) = (profit − cost) / cost × 100. If you enter the investment's final value, profit is automatically calculated as final value minus initial investment.

Simple ROI measures the total return regardless of how long it took. Annualized ROI adjusts that return to an equivalent yearly rate, allowing you to fairly compare investments with different durations.

Yes. If the net profit is negative (a loss), the ROI will also be negative and will be clearly shown in red to indicate the investment wasn't profitable.

Annualized ROI is only calculated if you enter a time period greater than zero. It's also mathematically impossible to calculate if the loss equals or exceeds 100% of the investment, since that would require a negative value inside a root.

Alternatives

The ROI formula, (profit − cost) / cost × 100, can be calculated in any spreadsheet or with a basic calculator. This tool adds the annualized ROI calculation, which involves a fractional exponent that's easy to get wrong by hand, and solves it automatically.