Calculating Rate of Return in Excel

Rate of Return Calculator

This calculator helps you determine the rate of return on an investment, a crucial metric for understanding how well your money has performed over a specific period. The rate of return (RoR) is expressed as a percentage and indicates the profit or loss generated on an investment relative to its initial cost.

function calculateRateOfReturn() { var initialInvestment = parseFloat(document.getElementById("initialInvestment").value); var finalInvestment = document.getElementById("finalInvestment").value; var timePeriod = document.getElementById("timePeriod").value; var resultDiv = document.getElementById("result"); if (isNaN(initialInvestment) || isNaN(finalInvestment) || isNaN(timePeriod)) { resultDiv.innerHTML = "Please enter valid numbers for all fields."; return; } if (initialInvestment <= 0) { resultDiv.innerHTML = "Initial investment must be greater than zero."; return; } if (timePeriod <= 0) { resultDiv.innerHTML = "Time period must be greater than zero."; return; } // Calculate total profit/loss var profitLoss = finalInvestment – initialInvestment; // Calculate simple rate of return var simpleRoR = (profitLoss / initialInvestment) * 100; // Calculate annualized rate of return (CAGR – Compound Annual Growth Rate) // Formula: ((Ending Value / Beginning Value)^(1 / Number of Years)) – 1 var cagr = (Math.pow((finalInvestment / initialInvestment), (1 / timePeriod)) – 1) * 100; resultDiv.innerHTML = "

Results:

" + "Total Profit/Loss: " + profitLoss.toFixed(2) + "" + "Simple Rate of Return: " + simpleRoR.toFixed(2) + "%" + "Compound Annual Growth Rate (CAGR): " + cagr.toFixed(2) + "%"; } .calculator-container { font-family: Arial, sans-serif; max-width: 600px; margin: 20px auto; padding: 20px; border: 1px solid #ddd; border-radius: 8px; background-color: #f9f9f9; } .calculator-container h2 { text-align: center; color: #333; margin-bottom: 20px; } .inputs { display: grid; grid-template-columns: 1fr; gap: 15px; } .input-group { display: flex; flex-direction: column; } .input-group label { margin-bottom: 5px; font-weight: bold; color: #555; } .input-group input[type="number"] { padding: 10px; border: 1px solid #ccc; border-radius: 4px; font-size: 16px; } .calculator-container button { width: 100%; padding: 12px 20px; background-color: #007bff; color: white; border: none; border-radius: 5px; font-size: 18px; cursor: pointer; transition: background-color 0.3s ease; margin-top: 15px; } .calculator-container button:hover { background-color: #0056b3; } .result-container { margin-top: 25px; padding: 15px; border: 1px solid #e0e0e0; border-radius: 5px; background-color: #fff; text-align: left; } .result-container h3 { color: #007bff; margin-top: 0; margin-bottom: 10px; } .result-container p { margin-bottom: 8px; font-size: 16px; color: #333; }

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