CAGR Calculator

Calculate the Compound Annual Growth Rate (CAGR) of any investment. Enter starting value, ending value, and time period to find the annualized return.

COMPOUND ANNUAL GROWTH RATE

37.97%

ABSOLUTE RETURN

β‚Ή4.00 L

TOTAL RETURN %

400.00%

GROWTH MULTIPLE

5.00x

YearValueGrowth
0β‚Ή1.00 Lβ€”
1β‚Ή1.38 L+β‚Ή37,972.966
2β‚Ή1.90 L+β‚Ή52,392.428
3β‚Ή2.63 L+β‚Ή72,287.387
4β‚Ή3.62 L+β‚Ή99,737.051
5β‚Ή5.00 L+β‚Ή1.38 L

What is CAGR?

CAGR (Compound Annual Growth Rate) is the average annual rate at which an investment grows over a specified time period, assuming profits are reinvested. Unlike simple average returns, CAGR smooths out volatility and gives you the true annualized growth rate.

CAGR Formula

CAGR = (Ending Value / Starting Value)^(1/n) βˆ’ 1

Where n is the number of years. For example, an investment that grows from β‚Ή1,00,000 to β‚Ή5,00,000 in 5 years has a CAGR of (5,00,000/1,00,000)^(1/5) βˆ’ 1 = 37.97% per year.

Where CAGR is Used

  • Mutual Fund Returns: Comparing scheme performance over 3, 5, 10 years
  • Stock Analysis: Evaluating revenue and earnings growth
  • Portfolio Tracking: Measuring overall portfolio performance
  • Business Valuation: Forecasting future growth based on historical data
Important: CAGR doesn't account for volatility or intermediate values. An investment that grows 100% in Year 1 and drops 50% in Year 2 ends flat β€” but CAGR shows 0%, hiding the wild ride.
CAGR = (Ending Value / Starting Value)^(1/n) βˆ’ 1

Where:

  • CAGR = Compound Annual Growth Rate
  • Ending Value = Final value of the investment
  • Starting Value = Initial investment amount
  • n = Number of years

πŸ“ Worked Example

1

β‚Ή1,00,000 grew to β‚Ή5,00,000 in 5 years

CAGR = (5,00,000 / 1,00,000)^(1/5) βˆ’ 1

= 37.97% per year

2

Total absolute return

(5,00,000 βˆ’ 1,00,000) / 1,00,000 Γ— 100

= 400% total, but CAGR is 37.97%

CAGR Calculator FAQ

πŸ”— Related Calculators

Reverse CAGR CalculatorProject future value from known CAGRIRR CalculatorHandle multiple cash flows (more advanced)SIP CalculatorCalculate SIP returnsMutual Fund ReturnsOne-time investment growthNPV CalculatorEvaluate investment using discount rate

πŸ”— Related Calculators

Reverse CAGR CalculatorCalculate the future value of your investment when the CAGR is already known. Enter initial investment, expected CAGR, and time period to project your portfolio growth.IRR CalculatorCalculate the Internal Rate of Return (IRR) for a series of cash flows. Evaluate investment profitability by finding the discount rate that makes the net present value zero.Mutual Fund Returns CalculatorCalculate mutual fund lumpsum and SIP returns with CAGR and XIRR. Compare growth across equity, debt, and hybrid funds. Includes expense ratio impact...Stock Return CalculatorCalculate total return from equity markets by combining capital gains with dividend yield over your holding period.

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πŸ“˜ Key Term

CAGRCompound Annual Growth Rate β€” the mean annual growth rate of an investment over a specified time period longer than one year. Used to compare performance of different investments on a standardized basis.Read full definition β†’