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CAGR calculator
The steady yearly growth rate between a start and an end value.
Quick answer
Enter the starting value, the ending value and the years. Money that doubles in 5 years grew at a CAGR of 14.87%.
CAGR
14.87%
- Total growth
- 100.00%
- Absolute gain
- โน10,000
CAGR smooths out the ups and downs. The real path was probably bumpier than a steady rate.
How it works
CAGR answers: what steady yearly rate would turn the start value into the end value over this time?
It lets you compare investments held for different lengths of time on the same footing.
It ignores what happened in between, so two very different journeys can have the same CAGR.
The formula
- CAGR = (End value รท Start value)^(1 รท years) โ 1
- Multiply by 100 to get a percentage
A worked example
โน10,000 growing to โน20,000 in 5 years: (20,000 รท 10,000)^(1/5) โ 1 = 0.1487, so CAGR = 14.87% a year.
Common questions
Is CAGR the same as average return?
No. An average of yearly returns ignores compounding. CAGR is the single steady rate that reproduces the final value.
Can CAGR be negative?
Yes, if the end value is lower than the start value.
Does CAGR work with SIPs?
Not directly, because money goes in at different times. Use XIRR for a SIP; this tool is for one start value and one end value.
What does CAGR ignore?
Volatility and the path taken. A fund that swung wildly and one that rose steadily can show the same CAGR.