What is the difference between ROI and CAGR?

ROI is the total percentage gain or loss over the whole period. CAGR asks what constant yearly rate would take you from the start value to the end value across N years. A rocky path and a smooth path with the same endpoints share the same CAGR.

Where do dividends, fees, and taxes go?

Fold them into the ending value (or reduce the start) when you want a rough total-return view, or use a spreadsheet IRR that lists each cash flow by date. This calculator uses the numbers you supply and does not pull brokerage statements.

Is CAGR a forecast of future returns?

No. It describes the historical interval you entered. Markets, products, and project outcomes can differ radically going forward. Past annualized rates are not guarantees.

What if my holding period is less than one year?

You can still compute ROI. Annualizing very short intervals can exaggerate temporary moves. Always label the actual window when you show an annualized number.

How do mortgages or leverage change ROI?

Price appreciation on an asset is not the same as return on equity after down payment, interest, and fees. Enter the cash you actually put in and the cash you actually take out if you want a leveraged cash ROI.

Why might my broker’s return differ?

Brokers may use time-weighted returns, money-weighted returns, different fee accruals, or currency conversions. Align definitions before declaring one number “wrong.”

Can ROI be more than 100%?

Yes. Ending at more than double the start produces ROI above 100%. That still may annualize to a moderate CAGR over a long enough horizon.

What happens with a zero or negative start value?

Simple ROI divides by the starting capital and CAGR uses a start/end ratio. A zero start makes both frameworks break in the usual schoolbook sense—choose a meaningful cost basis.

Does this replace a full business case?

No. Opportunity cost, risk, liquidity, inflation, and confidence in the ending-value estimate matter as much as the headline ROI. Treat the output as one quantitative slice.

How precise should I enter the number of years?

Match the real calendar span as closely as the tool allows (for example 2.5 years for thirty months). Rounding the horizon changes CAGR even when ROI stays fixed.

Is this personalized investment advice?

No. It is an educational calculator for arithmetic on user-supplied figures. Consult a licensed advisor for decisions about your own money.

Are investment figures uploaded?

No. ROI and CAGR computations for this tool run in your browser.

ROI & CAGR Calculator

Investors and project owners often need two answers: how much did the money grow in total, and what constant yearly rate would have produced that end value over the years held? This ROI & CAGR calculator takes a starting value, an ending value, and a time horizon to report total return and an annualized figure. Simple ROI ignores path and timing of extra cash flows unless you fold them into the inputs yourself. Taxes, fees, inflation, and leverage can change the economic story dramatically. Use results for education and scenario comparison—not as a promise of future performance or personalized financial advice.

Initial ($)Contributions ($)Final Value ($)Years

Total Invested

ROI

Estimated CAGR

CAGR assumes contributions at start; actual returns may differ.

Informational only; verify critical results independently.

How to use

Enter the starting value or cost basis for the position, project, or asset you want to evaluate.
Enter the ending value after the period you care about, using the same currency and a definition you can defend (market value, sale proceeds, etc.).
If you made contributions or withdrawals, adjust the start/end figures the way the tool’s fields expect, or compute a more detailed IRR in a spreadsheet when cash-flow timing matters.
Provide the holding period in years (including fractional years when supported) so CAGR annualization matches the true window.
Read simple ROI as total percentage gain or loss over the whole interval, independent of whether the path was smooth.
Read CAGR as the constant annual growth rate that would grow the start value into the end value over that many years.
Compare scenarios by changing only one input at a time—final value, horizon, or cost basis—so differences stay interpretable.
Subtract known fees or add known dividends into your ending value if you want an approximate total-return picture without a full cash-flow model.
Avoid over-interpreting CAGR on horizons much shorter than a year; annualizing noisy months can exaggerate.
Document taxes, inflation, and leverage outside the raw formula when presenting results to others.

Examples

$10,000 → $15,000 with no mid-period cash flows: ROI = (15k − 10k) ÷ 10k = +50%.
$5,000 → $8,000 in 2 years: CAGR = (8/5)^(1/2) − 1 ≈ 26.49% per year.
House $400,000 → $460,000 after 5 years: ROI = +15%; CAGR = (460/400)^(1/5) − 1 ≈ 2.84% (before costs).
$1,000 → $1,800 in 0.75 years: ROI = +80%; annualized figure looks larger—label the short window clearly.
Break-even: start $12,000, end $12,000 → ROI 0%, CAGR 0% for any positive horizon.
Loss: $20,000 → $16,000 in 3 years → ROI = −20%; CAGR = (0.8)^(1/3) − 1 ≈ −7.17%.
Marketing project: $2,500 spend → $4,000 tracked revenue → ROI = +60% on that attribution model.
$25,000 → $40,000 in 4 years → ROI = +60%; CAGR ≈ 12.47%.
If you contributed extra capital mid-way, simple start/end ROI may overstate skill—prefer time-weighted or money-weighted methods for rigor.
Negative CAGR example check: $10,000 → $7,000 in 2 years → CAGR = (0.7)^(1/2) − 1 ≈ −16.33%.

FAQ

What is the difference between ROI and CAGR?: ROI is the total percentage gain or loss over the whole period. CAGR asks what constant yearly rate would take you from the start value to the end value across N years. A rocky path and a smooth path with the same endpoints share the same CAGR.
Where do dividends, fees, and taxes go?: Fold them into the ending value (or reduce the start) when you want a rough total-return view, or use a spreadsheet IRR that lists each cash flow by date. This calculator uses the numbers you supply and does not pull brokerage statements.
Is CAGR a forecast of future returns?: No. It describes the historical interval you entered. Markets, products, and project outcomes can differ radically going forward. Past annualized rates are not guarantees.
What if my holding period is less than one year?: You can still compute ROI. Annualizing very short intervals can exaggerate temporary moves. Always label the actual window when you show an annualized number.
How do mortgages or leverage change ROI?: Price appreciation on an asset is not the same as return on equity after down payment, interest, and fees. Enter the cash you actually put in and the cash you actually take out if you want a leveraged cash ROI.
Why might my broker’s return differ?: Brokers may use time-weighted returns, money-weighted returns, different fee accruals, or currency conversions. Align definitions before declaring one number “wrong.”
Can ROI be more than 100%?: Yes. Ending at more than double the start produces ROI above 100%. That still may annualize to a moderate CAGR over a long enough horizon.
What happens with a zero or negative start value?: Simple ROI divides by the starting capital and CAGR uses a start/end ratio. A zero start makes both frameworks break in the usual schoolbook sense—choose a meaningful cost basis.
Does this replace a full business case?: No. Opportunity cost, risk, liquidity, inflation, and confidence in the ending-value estimate matter as much as the headline ROI. Treat the output as one quantitative slice.
How precise should I enter the number of years?: Match the real calendar span as closely as the tool allows (for example 2.5 years for thirty months). Rounding the horizon changes CAGR even when ROI stays fixed.
Is this personalized investment advice?: No. It is an educational calculator for arithmetic on user-supplied figures. Consult a licensed advisor for decisions about your own money.
Are investment figures uploaded?: No. ROI and CAGR computations for this tool run in your browser.

Formula / Method

Simple ROI = (end − start) ÷ start × 100%. CAGR = (end ÷ start)^(1 ÷ years) − 1, usually shown as a percent. Example: $5,000 to $8,000 in 2 years → ROI 60%, CAGR ≈ 26.49%. Requires positive start (and typically positive end for real CAGR displays).

Assumptions & Limitations

Lump-sum style start/end model unless you manually adjust for cash flows. Ignores taxes, inflation, fees, path volatility, and leverage unless reflected in your inputs. Short-period annualization can mislead. Educational math only—not financial, tax, or investment advice. Past returns do not guarantee future results.

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Last updated: 2026-07-13

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