Calculate your Return on Investment (ROI) and annualized returns.
Total Investment Cost:$0.00
Final Exit Value:$0.00
Dividends Earned:$0.00
Net Profit / Loss:$0.00
Return on Investment (ROI):0.00%
Annualized Return (CAGR):0.00%
Understanding Stock Rate of Return
Calculating the Rate of Return (RoR) on your stock investments is fundamental to evaluating portfolio performance. Unlike simple savings accounts, stock returns are composed of capital gains (the increase in stock price) and dividend income, minus any transaction costs or commissions paid to your broker.
This calculator helps investors determine the exact profitability of a trade by factoring in buy and sell prices, share volume, trading fees, and dividends collected during the holding period.
How the Calculations Work
To accurately assess your stock market performance, we look at several key metrics:
Total Investment Cost: This is your cost basis. It is calculated as (Buy Price × Number of Shares) + Commissions. Note: For simplicity in this tool, we subtract total commissions from the final profit, but effectively they increase your break-even point.
Capital Gains: The profit derived solely from the increase in the stock's price. Formula: (Sell Price - Buy Price) × Number of Shares.
Net Profit: The absolute dollar amount you earned or lost. It includes capital gains and dividends, minus all trading fees.
ROI (Return on Investment): This percentage shows the efficiency of the investment. It is calculated as (Net Profit / Initial Investment Cost) × 100.
Annualized Return (CAGR) vs. Simple ROI
While simple ROI tells you the total percentage return, it does not account for time. A 20% return over 1 year is excellent, but a 20% return over 10 years is poor.
Compound Annual Growth Rate (CAGR) standardizes your return to an annual basis, allowing you to compare investments held for different time periods. The formula used is:
CAGR = ((Final Value + Dividends) / Initial Cost)^(1 / Years Held) - 1
Using annualized returns gives you a realistic comparison against benchmarks like the S&P 500, which historically returns approximately 10% annually on average.
Factors Impacting Your Returns
When using a Stock Rate of Return Calculator, keep these variables in mind:
Commissions & Fees: Even small fees can eat into profits, especially for frequent traders.
Dividends: Reinvesting dividends (DRIP) can significantly accelerate compound growth, though this calculator treats them as cash payouts.
Taxes: This calculator shows pre-tax returns. Capital gains taxes (short-term vs. long-term) will reduce your actual "take-home" profit.
function calculateStockROI() {
// 1. Get Input Values
var buyPrice = parseFloat(document.getElementById('buyPrice').value);
var sellPrice = parseFloat(document.getElementById('sellPrice').value);
var shares = parseFloat(document.getElementById('shareCount').value);
var dividends = parseFloat(document.getElementById('dividends').value);
var commissions = parseFloat(document.getElementById('commissions').value);
var years = parseFloat(document.getElementById('holdDuration').value);
// 2. Validate Inputs
if (isNaN(buyPrice) || isNaN(sellPrice) || isNaN(shares)) {
alert("Please enter valid numbers for Buy Price, Sell Price, and Share Count.");
return;
}
// Set defaults for optional fields if empty/NaN
if (isNaN(dividends)) dividends = 0;
if (isNaN(commissions)) commissions = 0;
if (isNaN(years) || years 0 && initialPrincipal > 0) {
cagr = (Math.pow((totalProceeds / initialPrincipal), (1 / years)) – 1) * 100;
} else if (totalProceeds = 0) {
profitEl.className = "positive";
} else {
profitEl.className = "negative";
}
var roiEl = document.getElementById('resROI');
roiEl.innerText = roiPercent.toFixed(2) + "%";
if(roiPercent >= 0) {
roiEl.className = "positive";
} else {
roiEl.className = "negative";
}
var cagrEl = document.getElementById('resCAGR');
cagrEl.innerText = cagr.toFixed(2) + "%";
if(cagr >= 0) {
cagrEl.className = "positive";
} else {
cagrEl.className = "negative";
}
// Show results container
document.getElementById('results').style.display = "block";
}