Investment ROI Calculator
Calculate total return and annualized return on an investment over any time period. Factors in additional contributions for accurate results.
Any amount you added after the initial investment
How to use this calculator
Enter your initial investment, its current value, and how many years you've held it. Include any additional contributions you've added along the way. The calculator returns total return, total return percent, and annualized return (CAGR).
Why CAGR is the right comparison number
Suppose one investment doubled in 10 years and another tripled in 20 years. Which did better? CAGR makes it obvious: doubling in 10 years is 7.18%/year; tripling in 20 years is 5.65%/year. The first actually grew faster on an annualized basis, despite ending in a lower total value. CAGR normalizes away the time horizon and lets you compare investments directly.
Setting expectations
Long-run stock market returns have averaged ~10% nominal (~7% after inflation). Year-to-year results are wildly variable — the S&P 500 has had individual years of +30% and -37% in recent decades. Compounding smooths this out: the more years, the more likely your actual return converges toward the long-term average. This is why early contributions matter so much — they get the most time to ride the bumps.
What the calculator doesn't do
This is a simple point-to-point return calculation. It doesn't account for taxes (ordinary income vs long-term capital gains rates materially affect after-tax return), trading costs (usually minor in modern zero-commission accounts), or the exact timing of contributions (which matters for true IRR). For tax-adjusted or precise IRR analysis, use a portfolio tracker or a spreadsheet with dated cash flows.
Comparing to benchmarks
The S&P 500 is the default benchmark for US stock investments. Divide your CAGR by the S&P's CAGR over the same period to see if you've outperformed. A multi-decade study famously showed that the majority of active mutual funds underperform the S&P 500 after fees — which is the main argument for low-cost index funds for most retail investors.
Frequently asked questions
What's the difference between total return and annualized return?▾
Total return is cumulative — '100% total return' means your money doubled. Annualized return (CAGR) expresses that as a yearly compound rate. If your money doubled in 10 years, that's 100% total return or ~7.18% annualized. Annualized is what to use when comparing investments held for different periods.
Is my CAGR good or bad?▾
Benchmarks: S&P 500 long-term average ~10% nominal (~7% inflation-adjusted). Treasury bonds: ~4-5%. Cash/savings: ~3-5%. Real estate (owner-occupied, net of costs): ~3-4% real. If your CAGR outpaces the S&P 500 consistently, you're outperforming the market. Most people, after fees and bad timing, underperform it.
How does this account for money I added after the initial investment?▾
The calculator treats additional contributions as equivalent to initial investment (as if added on day one). This is a simplification; the true internal rate of return (IRR) varies depending on timing of contributions. For rough evaluation, this gives a reasonable estimate; for precise IRR, use a spreadsheet IRR() function with dated cash flows.
What does a negative annualized return mean?▾
You've lost money on an annualized basis. -5% annualized over 5 years means the value has compounded downward at 5% per year. A loss is a loss — but over short periods (a few years), don't panic about temporary negatives; diversified portfolios usually recover.
Should I include dividends?▾
Yes — for any stock or fund, compare total return (price appreciation + reinvested dividends) rather than just price. Most portfolio statements already show 'total return'. Excluding dividends understates true performance, especially for dividend-focused stocks where 30-40% of long-term return is reinvested dividends.
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