Calculate your return on investment (ROI), the annualized yield (CAGR) and compare up to two investment alternatives to choose the most convenient one.
Investment data
Reference benchmarks
ROI does not account for inflation or taxes. For precise comparisons always use the CAGR (annualized return).
ROI (Return on Investment) measures the total return on an investment: (Net gain / Initial investment) × 100. It is useful for comparing two investments of the same duration, but misleading for different durations — a 50% ROI in 1 year is very different from one in 10 years.
CAGR (Compound Annual Growth Rate) is the rate that, applied year after year, would take the investment from its initial to final value. It is the correct metric for comparing investments of different durations or comparing against market benchmarks.
Whenever you compare two investments of different durations, use the CAGR. A fund that returned 80% in 5 years has a CAGR of 12.5% annually. A bond that returned 35% in 3 years has a CAGR of 10.5%. The bond has a lower CAGR even though its ROI appears lower.
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