CAGR Calculator
This CAGR calculator works out the compound annual growth rate — the single steady yearly rate that would take a starting value to an ending value over a given period. Enter the starting value, ending value and number of years, and the calculator smooths out every irregular up-and-down year into one comparable number. It works equally well for investment returns, company revenue, portfolio value or any metric that changes over time.
The value at the beginning of the period — your initial investment, or a metric's starting figure (revenue, price, portfolio value).
The value at the end of the period — what the investment or metric grew (or shrank) to.
The length of the period between the starting and ending value, in years.
CAGR
20.11%
The single steady annual rate that explains your growth — e.g. ₹1,00,000 growing to ₹2,50,000 over 5 years is a 20.11% CAGR.
How many times over your money grew — a multiple of 2.5 means every ₹1 became ₹2.50.
The value at the beginning of the period, exactly as you entered it above.
The value at the end of the period, exactly as you entered it above.
How to use this cagr calculator
- 1Starting value: the figure at the beginning of your period — the amount you first invested, or a metric's opening value.
- 2Ending value: the figure at the end of the period. If the value fell, enter the smaller number here — CAGR handles negative growth correctly.
- 3Number of years: use decimals for partial years (e.g. 2.5) for more precise short-period CAGRs.
- 4Use CAGR to compare two investments fairly even if you held them for different lengths of time — a 5-year and a 3-year holding can be compared directly once both are expressed as CAGR.
Understanding your results
CAGR is the annualised, compounding-equivalent growth rate — not the average of each year's return, which is a common and misleading substitute. A fund that returns +50% then −50% has an average return of 0%, but its CAGR is deeply negative, because the −50% year erases far more value than the +50% year created. The growth multiple (ending value ÷ starting value) is the raw multiple your money achieved; CAGR expresses that same multiple as a fair, per-year rate so it can be compared across different time periods and different investments.
The formula
CAGR = ((End ÷ Begin)^(1/n) − 1) × 100Begin and End are the starting and ending values, and n is the number of years. The formula finds the single constant annual rate that, compounded n times, turns the starting value into the ending value — mathematically the same operation as compound interest run in reverse. Because it compounds, CAGR correctly accounts for volatility drag: it will always be lower than the simple arithmetic average of each year's returns whenever those returns vary year to year, which is why professionals quote CAGR rather than average annual return.
A worked example
An investment grows from ₹1,00,000 to ₹2,50,000 over 5 years: CAGR = ((250000/100000)^(1/5) − 1) × 100 ≈ 20.11% per year. That single rate, compounded five times, reproduces the 2.5× growth multiple exactly. Stretch the same growth over 8 years instead of 5, and CAGR falls to about 12.14% — the same total growth spread thinner over more time always produces a lower annualised rate. This is why CAGR, not total return, is the fair way to compare a fund held for 5 years against one held for 8.
Notes for the UK, US and India
CAGR is used identically in the UK, US and India — it is a pure mathematical measure with no currency- or market-specific convention. In India it is the standard way mutual funds report 3-year and 5-year performance (SEBI mandates CAGR, not simple average, for periods over a year). In the US, CAGR appears constantly in equity research and business valuation to compare revenue or earnings growth across companies. One universal caution: CAGR describes the path's endpoints, not its shape — two investments can share an identical CAGR while one moved smoothly and the other swung wildly, which matters if you cannot tolerate a rough ride.
Frequently asked questions
How is CAGR different from average annual return?+
Average return sums each year's percentage and divides by the number of years; CAGR compounds. A fund returning +50% then −50% averages 0% but has a negative CAGR, because CAGR reflects what actually happened to your money, not an arithmetic average of percentages.
Can CAGR be negative?+
Yes — enter an ending value lower than the starting value and the calculator returns a negative CAGR, correctly showing the investment shrank on average each year.
What is a good CAGR for mutual funds in India?+
Large-cap equity funds have historically delivered roughly 10–13% CAGR over long periods; mid- and small-cap funds have delivered more with far more volatility. Compare a fund's CAGR against its category average and a relevant index over the same period, not in isolation.
Does CAGR account for additional investments during the period?+
No — CAGR assumes a single starting value and a single ending value with nothing added or withdrawn in between. If you invested via SIP or made multiple contributions, use XIRR instead, which accounts for the timing and size of each cash flow.
How do I use CAGR to project future value?+
Apply the same compounding formula forward: Future value = Starting value × (1 + CAGR)ⁿ. Our compound interest calculator does exactly this if you want to project a value forward using an assumed rate rather than measure a rate from two known values.