Convert a total return over any holding period into an annualized return.
Please do not make financial decisions based on these results.
What is the Annualized Return Calculator?
Convert a total return over any holding period into an annualized return. To use the Annualized Return Calculator, enter starting value, ending value, days held; it returns annualized return, total return, gain, and shows them instantly as you type.
Comparing returns
To judge past performance use the average return calculator and the ROI calculator. For projects with several cash flows, the IRR calculator gives a single comparable rate, and the payback period calculator shows how long it takes to recover the cost.
How to use the Annualized Return Calculator
- Fill in the fields. You will need Starting value ($), Ending value ($), Days held. Use a rate of return you consider realistic; small changes compound into large differences. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the Annualized return, and the cards below show Total return, Gain. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the Annualized Return Calculator using the default values shown in the calculator above:
Inputs
| Starting value ($) | 5,000 |
|---|---|
| Ending value ($) | 6,150 |
| Days held | 420 |
Results
| Annualized return | 19.71% |
|---|---|
| Total return | 23% |
| Gain | $1,150.00 |
With these inputs the calculator returns Annualized return: 19.71%. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Starting value ($) from 5,000 to 6,000 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| Annualized return | 19.71% | 2.17% | -89% |
| Total return | 23% | 2.5% | -89.1% |
| Gain | $1,150.00 | $150.00 | -87% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the Annualized Return Calculator reports Annualized return, total return and gain. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. Investment returns are not guaranteed. The result shows what the numbers you enter would produce, not what the market will do. It is for information, not financial, tax or legal advice.
Frequently asked questions
Why annualize returns?
It puts investments held for different lengths of time on the same yearly footing.
Are investment returns guaranteed?
No. Real returns vary. Use these tools to compare scenarios, not to predict results.
What rate of return should I assume?
There is no guaranteed rate. Test a range of conservative and optimistic rates, and remember that fees and inflation reduce your real return.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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