ROI (Return on Investment) answers a simple question: how much did you gain or lose, relative to what you put in? This calculator also shows the annualized version (CAGR), which makes returns of different time periods actually comparable.
Why annualized return matters
A 50% total return sounds great — but is it over 2 years or 20? CAGR (Compound Annual Growth Rate) converts any total return into an equivalent steady yearly rate, so you can fairly compare investments held for different lengths of time.
A worked example
Turning $10,000 into $14,000 over 3 years is a 40% total ROI, but only about 11.9% per year once annualized — a very different picture than the same 40% earned in a single year.