Compound Annual Growth Rate (CAGR) Calculator
A CAGR (Compound Annual Growth Rate) Calculator computes the annualized rate of return of an investment over a specified period, assuming profits are reinvested. More info →
Input
Enter investment details to calculate CAGR.
How This Calculator Works
CAGR (Compound Annual Growth Rate) is the steady yearly growth rate that would take your investment from its starting value to its final value. Real investments go up and down; CAGR smooths that into one average yearly rate so you can compare investments fairly.
The Formula
CAGR = (Final Value ÷ Initial Investment)1 / Years − 1
Years = End Year − Start Year · Total Return = Final ÷ Initial − 1 · Absolute Return = Final − Initial
What Each Input Does
- Initial Investment
- The value at the start.
- Final Value
- The value at the end.
- Start Year / End Year
- The difference is the number of years. The end year must be after the start year.
Step by Step
- The number of years is end year − start year.
- Final value is divided by the initial investment to get the total growth.
- The growth is raised to the power 1 ÷ years, and 1 is subtracted.
- CAGR and total return are shown as percentages to 2 decimals.
Reading the Result
Positive CAGR – the investment grew on average each year.
Negative CAGR – it shrank on average each year.
Quick Example
100,000 grew to 250,000 from 2020 to 2025 (5 years).
CAGR = 2.51/5 − 1 = 20.11% a year. The total return is 150.00% and the absolute return is 150,000.
Artoval Financial Labs