CAGR Calculator – Instantly Calculate Your Annualized *** Growth

What is CAGR?
CAGR (Compound Annual Growth Rate) represents the smoothed annual growth rate of your ***, eliminating the noise from yearly ups and downs. Think of it as your portfolio’s “average speedometer” over the entire period.
Why CAGR Matters
- A $10,000 *** growing to $20,000 in 5 years has a CAGR of 14.87%, even if the annual returns fluctuated dramatically.
- Unlike simple total returns, CAGR allows fair comparisons between stocks, mutual funds, or business revenues across varying timeframes.
How to Use This CAGR Calculator
- Enter your values:
- Initial *** (e.g., $10,000)
- Final value (e.g., $25,000)
- *** duration in years (e.g., 7 years)
- Get your CAGR percentage and view a growth chart instantly.
CAGR Formula & How to Calculate Manually
CAGR converts irregular *** growth into a consistent annual rate:
CAGR=(Final ValueInitial Value)1Years−1\text{CAGR} = \left(\frac{\text{Final Value}}{\text{Initial Value}}\right)^{\frac{1}{\text{Years}}} - 1CAGR=(Initial ValueFinal Value)Years1−1
Example:
- Initial Value = $5,000
- Final Value = $12,000
- Duration = 6 years
CAGR=(12,0005,000)16−1=15.10%\text{CAGR} = \left(\frac{12,000}{5,000}\right)^{\frac{1}{6}} - 1 = 15.10\%CAGR=(5,00012,000)61−1=15.10%
Excel shortcut:
=((FV/IV)^(1/n))-1
CAGR vs. Other Growth Metrics
Metric |
Pros |
Cons |
Best Used For |
CAGR |
Smooths out volatility |
Ignores cash flow timing |
Multi-year performance comparison |
AAGR |
Shows yearly trends |
Can overstate growth |
Short-term trend ***ysis |
Absolute |
Simple dollar change |
Misleading over long periods |
Quick profit/loss overview |
Real-World CAGR Examples
Case 1: Stocks vs. Mutual Funds
- Stock A: $8,000 → $22,000 in 10 years → 10.66% CAGR
- Fund B: $8,000 → $18,000 in 10 years → 8.45% CAGR
Key insight: Higher absolute returns don’t always mean a higher CAGR.
[Calculate Mutual Fund CAGR Here]
Case 2: Business Revenue Growth
A startup’s revenue grows from $200K in Year 1 to $1.2M in Year 5, with a CAGR of 43.09% — even if some years saw declines.
Limitations of CAGR
⚠️ Use CAGR carefully when:
- *** volatility matters (e.g., a 50% loss followed by a 50% gain ≠ 0% CAGR)
- There are cash flows (deposits or withdrawals) during the period — XIRR is better here
- The time horizon is very short (1-2 years), as outliers can distort results
FAQ: Quick Answers
Q: Is CAGR the same as ROI?
A: No, ROI shows total return over time; CAGR annualizes that return.
Q: Can CAGR be negative?
A: Yes. For example, a drop from $10,000 to $7,000 over 3 years results in a -10.06% CAGR.
Q: What’s a good CAGR for stocks?
A: Historically, the market averages about 8-10% CAGR annually.
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