ROI Explained: How to Calculate Return on Investment
Learn ROI in plain English with examples. Calculate ROI for stocks, crypto, real estate, and trading. Understand what ROI misses and when to use CAGR instead.
ROI answers a simple question: how much did I gain or lose relative to what I invested?
The formula
ROI = (Final - Initial) / Initial
When ROI is enough
Short timeframes and quick snapshots.
What ROI misses
Time and contributions. For time-aware comparisons, use CAGR.
Tools: