ROI Calculator
Cost, gain, and optionally the holding period for an annualised figure.
ROI
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Net profit
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Multiple
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Annualised
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Worked example
Spending 1,000 to receive 1,500 is a 50% ROI and a 1.5× multiple. Held for two years, that annualises to 22.47% — the rate at which 1,000 would grow to 1,500 over that period.
ROI compares profit to cost, which makes it easy to compute and easy to compare across projects. It says nothing about risk, timing within the period, or the cost of the capital used.
Annualising
A 50% return over two years is not 25% a year. Compounding means the annual rate is the geometric mean: (1.5)^(1/2) − 1 = 22.47%. Dividing by the number of years overstates long-horizon returns and understates short ones.