About this calculator
Our ROI Calculator helps you determine your investment profitability.
What is ROI?
Return on Investment or ROI is a monetary measure that is employed to gauge the profitability or efficiency of an investment in relation to its expense. It displays the amount of profit or loss an investment produces in regard to the investment. ROI is calculated as a percentage so as to easily compare various investments, projects or business ventures. Higher ROI means that the investment is making more money than the money invested whereas low or negative ROI means poor performance or a loss. ROI is widely used by investors, businesses and marketers to assess the efficiency of their investments and make informed choices and select other opportunities with high returns.
ROE vs. ROI
ROE (Return on Equity) and ROI (Return on Investment) are both profitability ratios, but they are also concerned with different issues. ROI is used to estimate the efficiency of an investment based on how the investment is funded by evaluating the net change in value divided by the amount invested in the investment irrespective of the financing source. ROE, in contrast, is much more specific, as it determines the profitability of a given company, the profitability divided by the equity of the shareholders and indicates how well a business utilizes the equity capital to produce profit. Simply put, ROI is more general and can be used to refer to any investment, whereas ROE is concerned with the performance of the business that is funded by equity.