Percentage Return Calculator

Created by Wei Bin Loo
Reviewed by Dominik Czernia, PhD and Adena Benn
Based on research by
Brealey RA, Myers SC, Allen F. Principles of Corporate Finance (2017)
Last updated: Mar 14, 2023

We have written this article to help you to understand the percentage return definition and how to calculate percentage return on investment. We will also demonstrate some examples to help you understand the liquid net worth calculation.

What is percentage return investment?

Percentage return is an important concept to understand if you want to venture into the investment world. It tells you how much returns your money generates for you.

For example, if the percentage return is 150%, it means that your investments have generated 1.5 times the money you invested.

How to calculate percentage return on investment

To understand the calculation of percentage return, let's take the following investment as an example:

• Investment name: Investment Alpha
• Invested amount: $10,000 • Returned amount:$20,000
• Investment duration: 2 years

You can calculate your stock percentage return in three steps:

1. Determine your initial investment amount

The first step is to work out your initial investment amount (the invested amount). For Investment Alpha, this will be $10,000. 2. Calculate your returned amount The next step is to calculate your returned amount. This is the amount of money your investment account contains after the investment duration. For our example, the returned amount is $20,000.

This investment has a gain of $20,000 -$10,000 = $10,000. You can visit our capital gains yield calculator to understand more about this calculation. 3. Calculate the return percentage The last step is to calculate the percentage return for the investment. You can calculate it using the following formula: percentage return = (returned amount - initial investment) / initial investment Thus, for Investment Alpha, the percentage return is $10,000 / $10,000 = 100%. You can obtain the same result with our percentage return calculator, which has several additional features that might help you with your issues. Give it a try! Why do we need annualised percentage return? Now that we know how to calculate the percentage return from an investment, let's talk about the importance of calculating the annualized percentage return. This metric is important because it is useful to compare different investments. If two investments have different investment duration, it is unfair to compare their percentage return since one has a longer period to generate greater returns. Hence, we use annualized percentage returns to compare them fairly as it tells us how much return each investment generates in a year. You can calculate the annualized percentage return using the following formula: $\footnotesize \mathrm{annualised \ percentage \ return} \\[0.5em] \quad \mathrm{= percentage \ return^{1/investment \ duration}}$ Our percentage return calculator can not only help you to calculate your annualized percentage return but also lets you compare two different investments in terms of their performances. Are you planning to invest in the near future? Visit our sip calculator to learn how much you need to invest to achieve your goal. FAQ Can percentage return be negative? Yes, percentage return can be negative. This can happen when the returned amount after the investment duration is lower than the initial investment amount. How do I calculate my stock percentage return? You can calculate your stock percentage return in three steps: 1. Determine your initial investment amount. 2. Calculate your returned amount. 3. Apply the percentage return formula: percentage return = (returned amount - initial investment) / initial investment What is the percentage return if the returned amount equals the invested amount? The percentage return will be 0%. This is because your investment has not generated any returns during the investment period. What is annualized percentage return? Annualized percentage return is the percentage return calculated in annualized form so that it is easier to compare different investments. You can calculate it using this formula: annualized percentage return = percentage return^(1/investment duration). Wei Bin Loo Basic percentage return Invested amount$
Returned amount
$Gain or loss$
Percentage return
%
Annualized percentage return
I want to find...
annualized percentage return
Start date
End date
Investment duration
yrs
Annualized percentage return
%
Do you want to compare it to another investment?
No
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