ROI: return on investment and annualized return
ROI tells you how hard your money worked. Invested vs returned gives gain and ROI %, annualized spreads it per year for fair comparison. Use it to compare a 35% over 3 years with 20% in 1 year without being misled. Separate nominal from real: at 2% yearly inflation a 35% over 3 years buys less, and for rentals subtract vacancy and maintenance from proceeds before dividing.
TL;DR
- Gain is returned minus invested.
- Formulas: ROI % = (Returned - Invested)/Invested ×100 | Annualized % = (Returned/Invested)^(1/years)-1
- 10k →13.5k in 3y — Gain 3,500
How it works
Gain is returned minus invested. ROI % is gain divided by invested times 100. Annualized ROI is the steady yearly rate that compounds to the same final amount: (Returned/Invested)^(1/years)-1. ROI measures how hard your money worked. Take what you got back, subtract what you put in to get the gain, then divide the gain by what you put in. Th
The math
Gain = Returned - Invested. ROI = Gain/Invested*100. Annualized = (Returned/Invested)^(1/years)-1. Example 13500/10000=1.35, ^1/3≈1.105 →10.5% per year.
Annualized uses geometric mean to spread growth evenly. Without years, ROI is total.
Examples
10k →13.5k in 3y
- Gain 3,500
- ROI 35%
- Annualized ≈10.5%
Flip 135k →180k
- Gain 45k
- ROI 33.3%
House 200k →260k in 5y
- Gain 60k
- ROI 30%
- Annualized ≈5.4%
When to use it
✦ Investments
Compare stocks, real estate, projects.
✦ Business cases
Pitch ROI with time-adjusted figure.
✦ Fund comparison
Annualized return vs category benchmark.
⚠ Common mistakes
- Mixing gross return with net gain
- Comparing total ROI without annualizing
- Forgetting transaction and management costs in invested
FAQ (7)
What is good ROI?
7-10% annualized diversified, 8-12% real estate after costs.
Include fees?
Add all costs to invested for true net ROI.
Annualized or total?
Under a year total is enough, beyond that always annualize.
If I type my salary or prices here, do you store them?
No — and that's deliberate. Everything runs locally in your browser, nothing leaves your device. We don't see your net salary, your margins, or the VAT numbers you test. For a finance tool that matters: you can run a quick check on a payslip or an invoice while on public Wi-Fi and close the tab knowing no trace is kept server-side.
Can I use it on the train without signal to check an invoice?
Yes. Load the page once, then it works offline. VAT, discount and mortgage math are all pure JavaScript — no API call. I often test it in airplane mode: open the mortgage page, type 250,000 at 4.5% for 25 years, you get the schedule instantly, even in a tunnel.
Can I file taxes with these results?
Use it as a fast sanity check, not as the final filing. Formulas are standard (e.g. Net = Gross / 1+VAT) and verified against official sources listed at the bottom, but rates and thresholds change — Italy's 22% vs Germany's 19%, or IRPEF brackets. For the actual declaration, double-check with your accountant or Agenzia delle Entrate / HMRC / IRS.
How do I send a calculation to my accountant?
Hit 'Share Link' under the results. It encodes the inputs in the URL — e.g. ?price=1200&vat=22 — so your accountant opens the exact same view, no screenshot needed. You can also copy the result with one tap and paste it into an email.
Sources & References
⚠ Financial Disclaimer
This tool provides estimates for informational purposes only and does not constitute financial, tax, or legal advice. Results may vary based on local regulations, rates, and individual circumstances. Always consult a qualified professional before making financial decisions.
How this calculator is maintained
This calculator is written and maintained by Davide Coronese, independent developer and founder of CalcTracker.
Methodology: every formula is checked against official publications and validated by an automated test suite before release. Health, tax and finance pages cite the exact sources they rely on.
Found an error? Contact us — verified corrections ship within 24 hours.