CAGR Calculator

Calculate the Compound Annual Growth Rate between a starting and ending value over any number of years.

What is the CAGR Calculator?

CAGR is the constant yearly rate at which an investment would have grown from its starting value to its ending value. It smooths out year-to-year volatility.

How does it work?

The calculator takes the ratio of final to initial value, raises it to the power of 1 ÷ years and subtracts 1.

Formula

CAGR = (Final ÷ Initial)^(1 ÷ years) − 1

Example

₹1,00,000 growing to ₹2,50,000 in 5 years gives a CAGR of 20.11%, even though the absolute return is 150%.

Frequently asked questions

What is the difference between CAGR and absolute return?

Absolute return is total growth regardless of time. CAGR annualises it so you can compare investments held for different periods.

Can CAGR be used for SIPs?

Not directly, because money is invested at different times. For SIPs, XIRR is the right measure.

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