Return on Investment (ROI) Calculator (AU)

How to Use the ROI & Investment Return Calculator

Our free ROI calculator helps Australian investors understand the true return on their investments, accounting for contributions, dividends, fees, inflation, and capital gains tax. Whether you're evaluating shares, ETFs, managed funds, or property, this tool provides comprehensive return analysis across four precision levels.

Return on Investment measures the gain or loss relative to its cost. Simple ROI = (Final Value − Cost) / Cost × 100%. While useful for quick comparisons, simple ROI doesn't account for time, contributions, or compounding. That's where CAGR provides a more meaningful measure.

CAGR represents the smoothed annual rate of return. Unlike simple ROI, it accounts for compounding and enables meaningful comparisons between investments held for different periods. Formula: CAGR = (FV/PV)^(1/n) − 1.

Management fees compound against you. A 1% annual fee can reduce your final portfolio value by 15–25% over 20–30 years compared to a 0.1% fee fund. Consider low-cost index ETFs where the average MER in Australia ranges from 0.04% to 0.70%.

Australian residents holding assets for more than 12 months receive a 50% CGT discount — only half the gain is taxed at your marginal rate. Super funds receive a 33.33% discount. Our L2 mode calculates the after-tax return.

An 8% nominal return with 3.5% inflation delivers only about 4.35% in real purchasing power. Over 20 years, this difference compounds dramatically. The RBA targets inflation of 2–3% p.a.

The ASX 200 has historically delivered a gross dividend yield of approximately 4–5% p.a. Reinvesting dividends through a DRP allows compounding, and over long periods, dividend reinvestment can account for more than half of total returns.

Common Australian benchmarks include the S&P/ASX 200 Total Return Index (avg ~9.8% p.a. incl. dividends), the MSCI World Index, and the Bloomberg AusBond Composite. L3 Advanced mode includes benchmark comparison with alpha.

Simple ROI shows total percentage gain regardless of time. CAGR annualises the return. A 100% total return over 10 years is 7.18% CAGR; over 5 years it's 14.87% CAGR.

Hold for 12+ months and only 50% of the capital gain is taxable. For example, a $10,000 gain means $5,000 is taxed at your marginal rate. Super funds receive a 33.33% discount.

For long-term wealth building, reinvesting generally produces higher total returns. For income needs (e.g. retirement), taking dividends as cash makes sense.

Australian shares have returned ~9–10% p.a. incl. dividends over 20+ years. After inflation and fees, a real return of 4–6% p.a. is generally considered good.

Sharpe = (Portfolio Return − Risk-Free Rate) / Volatility. Above 1.0 is good, above 2.0 is very good, above 3.0 is excellent. It measures risk-adjusted return.