ROI Calculator - Measure Investment Returns
Calculate your return on investment for various assets and strategies. Visualize growth projections and make informed investment decisions.
Investment Details
Investment Results
Understanding Return on Investment (ROI)
Return on Investment (ROI) is a crucial financial metric used to evaluate the efficiency and profitability of an investment. It measures the amount of return on an investment relative to its cost. Calculating ROI helps investors compare the efficiency of different investments and make informed decisions.
The basic ROI formula is: ROI = (Net Profit / Cost of Investment) × 100%
This advanced ROI calculator considers compound interest, which allows your investment to grow exponentially over time. With compound interest, you earn returns not only on your initial investment but also on the accumulated returns from previous periods.
Key factors affecting your investment returns:
- Initial Investment: The amount you start with
- Regular Contributions: Ongoing investments that accelerate growth
- Investment Duration: Time allows compound interest to work effectively
- Expected Return: The annual growth rate of your investment
Use this calculator to project future investment values, visualize growth patterns, and make strategic financial decisions. Understanding these dynamics can significantly impact your long-term wealth accumulation strategy.
Frequently Asked Questions
ROI (Return on Investment) is a performance measure used to evaluate the efficiency of an investment. It's important because it allows investors to compare different investment opportunities and determine which ones generate the best returns relative to their costs.
Our calculator provides projections based on the information you enter. It assumes a constant rate of return and regular contributions. While it can't predict market fluctuations, it gives a reliable estimate of potential returns based on your inputs.
For the most accurate personal projections, consider taxes on investment gains. However, this calculator shows pre-tax returns. Consult a tax professional for personalized advice regarding your specific situation.
Compound interest accelerates investment growth by generating earnings on both your initial principal and the accumulated interest from previous periods. Over long time horizons, compounding can significantly increase your total returns.