ROI Calculator

Return on Investment (ROI) Concept

Definitions - Return on Investment (ROI)

Return on Investment

Gain or loss, which is generated on an investment relative to invested amount of money, can be measured by return on investment (ROI) [1]. So, ROI provides companies or people to measure their gain or loss, return on investment and annualized return on investment.

ROI Formula - How to Calculate ROI

Let

$F$ = Income,
$I$ = Initial Investment,
$N$ = Number of Years,

$P$ = Gain or Loss,
$R$ = Return on Investment,
$R_a$ = Annualized Return on Investment.

We have

Examples

Example 1

Input

Investment = 2000
Income = 1500
Years = 3.5

Output

Gain or Loss = -500
ROI = -25%
Annualized ROI = -7.143%

Example 2

Input

Investment = 1000
Income = 1200
Years = 2

Output

Gain or Loss = 200
ROI = 20%
Annualized ROI = 10%

References

1. Return on investment (ROI) (n.d.). Retrieved June 13, 2017, from http://www.investinganswers.com/ financial-dictionary/technical-analysis/ return-investment-roi-1100