CAGR
CAGR Calculator
Measure the compounded annual growth rate between an initial value and a final value over a stated number of years.
How the calculator works
CAGR compresses an entire journey into one annual rate. It tells you the constant yearly growth that would turn the starting amount into the ending amount in n years. It says nothing about the path in between — a volatile fund and a smooth deposit can share the same CAGR.
CAGR formula
CAGR = (FV / PV)^(1 / n) − 1
FV is the ending value, PV is the starting value, and n is the number of years. Multiply by 100 to express the result as a percentage.
Example
₹1,00,000 growing to ₹2,00,000 in 5 years has a CAGR of about 14.87%. Doubling in five years is not 20% a year, because each year’s growth compounds on the last.
Important considerations
Extra investments or withdrawals during the period break the CAGR identity. Point-to-point figures can look strong if you pick a favourable start date. Use CAGR to compare similar holding periods, not as a promise of future performance.
Frequently asked questions
Why is CAGR different from average annual return?
A simple average of yearly returns ignores compounding. CAGR is the single constant rate that takes you from the start value to the end value over the same years.
Can CAGR be negative?
Yes. If the final value is below the initial value, the rate is negative. That still answers “what constant annual rate matches this decline?”
Should I use CAGR for a SIP?
CAGR on a SIP is misleading because money was added over time. Use XIRR for irregular cash flows. This calculator is for a start value, an end value and a duration.
Related calculators
- SIP CalculatorEstimate the future value of monthly systematic investments, with an optional annual step-up.
- XIRR CalculatorEstimate the annualised return of a monthly SIP given the ending portfolio value.
- Mutual Fund CalculatorMeasure absolute gain and CAGR from the amount invested and the current fund value.
- Compound Interest CalculatorCalculate compound interest with yearly, quarterly, monthly or daily compounding.
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