CAGR Calculator
Find the compound annual growth rate of an investment from its start and end values — smooth the year-to-year swings into one annualised figure, with total growth shown too.
What is CAGR?
A CAGR calculator works out the compound annual growth rate — the steady annual rate at which an investment grew from its beginning value to its ending value, assuming the returns were reinvested each year. CAGR smooths the year-to-year ups and downs into one comparable percentage, which makes it far easier to judge performance over time.
This free CAGR calculator takes three inputs — initial value, final value and the number of years — and returns both the annualised growth rate and the total growth. It applies the formula CAGR = (final ÷ initial)^(1 ÷ years) − 1. Because it accounts for compounding, CAGR is usually a more honest single figure than a simple average of annual returns. The calculation runs entirely in your browser, so the result appears instantly and nothing is uploaded.
How to use
- Enter the starting (initial) value of the investment.
- Enter the final value it reached.
- Enter the number of years over which it grew.
- Click Calculate CAGR to see the annual growth rate and total growth.
How CAGR is calculated
CAGR = (final ÷ initial)^(1 ÷ years) − 1
The result tells you the constant annual rate that would turn the initial value into the final value over the given number of years, accounting for compounding.
Example
With the defaults — ₹1,000 as the initial value, ₹2,000 as the final value and 5 years — click Calculate CAGR. The result is about 14.87% per year, and the total growth is ₹1,000. That means ₹1,000 growing at roughly 14.87% compounded each year for 5 years turns into ₹2,000.
Who is this CAGR calculator for?
A CAGR calculator turns a beginning value, an ending value and a period into one annualised growth rate. It answers the "CAGR calculator" question for the people who search it most:
- Students and young adults: a CAGR calculator for students and young adults checking how an index fund or a small portfolio has grown, smoothing year-to-year swings into one easy-to-compare annualised rate.
- Couples: a CAGR calculator for couples comparing long-term funds or a joint investment, seeing the annualised growth rate over the same number of years.
- Salaried professionals: a CAGR calculator for salaried professionals reviewing SIPs, fixed deposits or mutual funds — verifying whether actual growth matched the expected CAGR over the holding period.
- Retirees: a CAGR calculator for retirees assessing portfolio or business growth over a long retirement horizon, judging an honest annualised return before drawing income.
CAGR reference table
This table shows the compound annual growth rate and total growth for a set of start and end values, recomputed with the tool's own formula — CAGR = (final ÷ initial)^(1 ÷ years) − 1. Keep it as a CAGR chart and growth-rate table for quick comparisons.
| Initial value | Final value | Years | CAGR (%) | Total growth |
|---|---|---|---|---|
| ₹1,00,000 | ₹2,00,000 | 5 | 14.87 | ₹1,00,000 |
| ₹1,00,000 | ₹2,00,000 | 7 | 10.41 | ₹1,00,000 |
| ₹1,00,000 | ₹2,00,000 | 10 | 7.18 | ₹1,00,000 |
| ₹2,50,000 | ₹4,00,000 | 8 | 6.05 | ₹1,50,000 |
| ₹50,000 | ₹1,00,000 | 6 | 12.25 | ₹50,000 |
Common use cases
- Compare investments: judge stocks, mutual funds or portfolios that grew over different periods.
- Check business growth: see the annualised revenue or profit growth of a company over several years.
- Plan goals: estimate the rate needed to double your money or reach a target value.
- Verify SIP or FD returns: compare an investment’s actual growth against what you expected.
Pro tips
- CAGR isn’t a simple average: it compounds, so it is lower than an arithmetic average when returns vary.
- Compare like with like: only use CAGR to compare investments over similar time periods.
- Try the Rule of 72: dividing 72 by the CAGR roughly estimates doubling time — 14.87% ≈ 4.8 years.
- CAGR ignores risk: two investments with the same CAGR can have very different volatility and drawdowns.
FAQ
What is CAGR?
Compound annual growth rate is the smoothed annual rate at which an investment grows over a period, assuming the gains are reinvested each year.
How is CAGR calculated?
CAGR = (final ÷ initial)^(1 ÷ years) − 1. A ₹1,000 value growing to ₹2,000 in 5 years gives about 14.87%.
Why use CAGR instead of a simple average?
CAGR accounts for compounding and for the varying returns each year, giving a more realistic single figure than an arithmetic average.
What's a good CAGR?
It depends on the asset and horizon. Historically the S&P 500 has delivered around 10-11% CAGR, but past performance doesn't guarantee future results.
Can CAGR be negative?
Yes. If the final value is lower than the initial value, CAGR is negative, indicating a decline over the period.
How do I calculate CAGR in Excel?
Use =POWER(final/initial, 1/years) - 1, or the RATE function =RATE(years, 0, -initial, final).
What is the Rule of 72?
A quick mental estimate of doubling time: divide 72 by the CAGR. At 8%, it takes about 9 years to double your money.
Does CAGR measure risk?
No. It ignores volatility, so two investments with the same CAGR can have very different risk profiles.
Can I use CAGR for monthly data?
Yes. Use the number of periods as n, then annualise by multiplying by 12 if you want a yearly rate.
Is this CAGR calculator free?
Yes. It runs entirely in your browser and no data is uploaded anywhere.
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