ROI Calculator

ROI and why the period matters

Return on investment is the profit as a share of what you put in. On its own it says nothing about time: a 36% return is excellent over a year and poor over ten. That is why this calculator also gives the annualised rate — the yearly rate that would compound to the same result — which is the only fair way to compare two investments.

Formula

• Profit = returned − (invested + other costs)
• ROI = profit ÷ invested × 100
• Annualised = ((returned ÷ invested)^(1 ÷ years) − 1) × 100
• Years to double = ln(2) ÷ ln(1 + rate)

Worked example

250,000 invested, 340,000 back after 18 months: a profit of 90,000, an ROI of 36%, and an annualised return of 22.8%. At that rate the money would double in about 3.4 years.

How to use the ROI calculator

1. Enter what you put in and what came back — the sale value, or today's value if you still hold it.
2. Add the other costs: fees, commission, maintenance, anything that came out of your pocket.
3. Enter the months you held it, and compare the annualised figure against your other options.

Using it honestly

• Include every cost. Brokerage, registration, stamp duty and tax turn many impressive ROIs into ordinary ones.
• Compare against what the money could have earned elsewhere — a fixed deposit is the usual benchmark in Bangladesh.
• Subtract inflation for the real return. 9% in a year of 9% inflation is standing still.
• ROI ignores risk entirely. A 20% return on something that could have gone to zero is not the same as 20% from a bank.

Frequently asked questions

How do you calculate ROI?

Subtract what you invested from what you got back, divide by what you invested, and multiply by 100. 90,000 profit on 250,000 is a 36% return.

What is annualised return?

The yearly rate that, compounded over the holding period, gives the same result. It lets you compare a six-month gain with a five-year one fairly.

Should ROI include fees and taxes?

Yes, if you want a real answer. Put every cost into the "other costs" field — fees are precisely what separates the advertised return from the one you keep.