How to Calculate Annual Salary Into Hourly Rate

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Investment ROI Calculator

Your Investment ROI will be displayed here.

Understanding Investment Return on Investment (ROI)

Return on Investment (ROI) is a crucial performance measure used to evaluate the efficiency or profitability of an investment. It is expressed as a percentage and helps investors understand how much return they have generated relative to the cost of their investment. A positive ROI indicates that the investment has been profitable, while a negative ROI signifies a loss.

The basic formula for calculating ROI is:

ROI = ((Final Investment Value – Initial Investment) / Initial Investment) * 100

This formula gives you the total percentage return over the entire period of the investment. For more nuanced analysis, especially when comparing investments of different durations, the Annualized ROI is often used.

The formula for Annualized ROI is:

Annualized ROI = ( (1 + Total ROI)^(1 / Number of Years) – 1 ) * 100 Where Total ROI is the ROI calculated using the basic formula (expressed as a decimal, e.g., 0.50 for 50%).

How to Use This Calculator:

  • Initial Investment: Enter the total amount of money you initially put into the investment.
  • Final Investment Value: Enter the current or final value of your investment after a certain period.
  • Investment Duration (in years): Enter the number of years you held the investment.

The calculator will then provide you with both the Total ROI and the Annualized ROI, giving you a comprehensive view of your investment's performance.

Example:

Let's say you invested $10,000 (Initial Investment) in a stock. After 5 years, the value of that stock has grown to $15,000 (Final Investment Value).

Calculation:

  • Total Gain = $15,000 – $10,000 = $5,000
  • Total ROI = ($5,000 / $10,000) * 100 = 50%
  • Annualized ROI = ( (1 + 0.50)^(1 / 5) – 1 ) * 100 = ( (1.50)^(0.2) – 1 ) * 100 = (1.08447 – 1) * 100 = 8.45%

This means your investment yielded a total return of 50% over 5 years, which averages out to approximately 8.45% per year.

function calculateROI() { var initialInvestment = parseFloat(document.getElementById("initialInvestment").value); var finalInvestment = parseFloat(document.getElementById("finalInvestment").value); var investmentDuration = parseFloat(document.getElementById("investmentDuration").value); var resultDiv = document.getElementById("roi-result"); if (isNaN(initialInvestment) || isNaN(finalInvestment) || isNaN(investmentDuration) || initialInvestment <= 0 || investmentDuration 0) { annualizedROI = (Math.pow((1 + (totalROI / 100)), (1 / investmentDuration)) – 1) * 100; } resultDiv.innerHTML = "Total ROI: " + totalROI.toFixed(2) + "%" + "Annualized ROI: " + annualizedROI.toFixed(2) + "%"; }

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