Measure investment profitability with ROI and annualized ROI. Compare multiple investments side by side. Calculate total ROI, growth multiple, and annual returns.
Return on Investment
Return on Investment (ROI)
+80.00%
Invested
₹1,00,000
Current Value
₹1,80,000
Return on Investment (ROI) measures the profitability of an investment as a percentage of the original cost. It tells you how much you gained or lost relative to what you invested.
ROI = (Current Value - Cost) / Cost × 100
Annualized ROI = (FV/PV)1/n - 1
Annualized ROI (same as CAGR) is more useful for comparing investments across different time periods. A 100% ROI over 10 years is ~7.2% annualized, while 100% over 3 years is ~26% annualized.
A good ROI depends on context. For stocks in India, 12-15% annualized is considered good. For real estate, 8-12% including rental yield. For business investments, anything above 15-20% is attractive. Always compare ROI with risk-free alternatives like FDs (6-7%).
ROI shows the total return as a percentage without considering time. CAGR (Compound Annual Growth Rate) is the annualized version of ROI. A 200% ROI over 5 years = 24.57% CAGR. For comparing investments, always use annualized ROI / CAGR.
Yes, ROI is negative when you lose money. If you invested ₹1 lakh and the current value is ₹80,000, your ROI is -20%. A negative ROI means the investment lost value. However, for equity investments, negative short-term ROI often turns positive over longer periods.
For real estate, include all costs: purchase price, stamp duty, registration, renovation, and maintenance. For returns, include the sale price plus total rental income received. ROI = (Total Returns - Total Costs) / Total Costs × 100.
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