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CAGR Calculator - Compound Annual Growth Rate Calculator

Calculate the Compound Annual Growth Rate (CAGR) of your investments. Find annualized returns, compare investment performance, and analyze portfolio growth over time.

Results

CAGR

20.11%

Annual growth rate

Total Return

150.00%

Overall percentage gain

Absolute Gain

₹1,50,000

Total profit earned

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Disclaimer

This calculator is for informational and educational purposes only. It does not constitute financial or investment advice. Consult with a qualified financial advisor before making investment decisions.

What is CAGR Calculator - Compound Annual Growth Rate Calculator?

CAGR (Compound Annual Growth Rate) calculator helps you determine the annual growth rate of your investment over a specified time period. It's one of the most accurate ways to calculate and compare returns of different investments, assuming profits are reinvested at the end of each year. CAGR represents the rate at which an investment would have grown if it had grown at a steady rate compound annually. It smooths out the year-to-year volatility and provides a clearer picture of investment performance over time.

How to Use This Calculator

  1. Enter the initial value of your investment
  2. Input the final (current) value of your investment
  3. Specify the investment duration in years
  4. View the CAGR percentage instantly
  5. Compare CAGR across different investments to identify best performers

Formula Used

CAGR (Compound Annual Growth Rate) Formula: CAGR = [(Final Value / Initial Value)^(1/Duration) - 1] × 100 Where: - Final Value = Current value of the investment - Initial Value = Starting value of the investment - Duration = Number of years of investment Example Calculation: Initial Investment: ₹1,00,000 Final Value: ₹2,50,000 Duration: 5 years CAGR = [(2,50,000 / 1,00,000)^(1/5) - 1] × 100 CAGR = [(2.5)^(0.2) - 1] × 100 CAGR = [1.2011 - 1] × 100 CAGR = 20.11% This means your investment grew at an average rate of 20.11% per year.

Example Calculation

Real-World CAGR Examples: Example 1: Stock Market Investment Initial Investment: ₹1,00,000 (Jan 2020) Current Value: ₹1,76,234 (Jan 2025) Duration: 5 years CAGR = [(1,76,234 / 1,00,000)^(1/5) - 1] × 100 = 12% per year Example 2: Mutual Fund Performance Initial NAV: ₹50 Current NAV: ₹120 Duration: 7 years CAGR = [(120 / 50)^(1/7) - 1] × 100 = 13.5% per year Example 3: Gold Investment Initial Price: ₹30,000/10g Current Price: ₹62,000/10g Duration: 10 years CAGR = [(62,000 / 30,000)^(1/10) - 1] × 100 = 7.5% per year Benchmark CAGR Values: - Sensex (20 years): ~10-11% - Nifty 50 (20 years): ~11-12% - Large-cap Funds: 10-12% - Mid-cap Funds: 12-15% - Small-cap Funds: 13-18% - Gold: 7-9% - Real Estate: 8-10%

Frequently Asked Questions

What is a good CAGR for stocks?

Historically, the stock market has delivered a CAGR of around 10-12% over long periods (15-20 years). Individual stocks can vary significantly - anything above 15% is considered excellent. Large-cap stocks typically deliver 10-12%, mid-caps 12-15%, and small-caps 15%+ CAGR over long periods.

Can CAGR be negative?

Yes, if your investment has lost value over time, CAGR will be negative, indicating an average annual decline in value. For example, if you invested ₹1,00,000 and it's now worth ₹80,000 after 3 years, your CAGR would be -7.2%.

What's the difference between CAGR and absolute returns?

Absolute return is the total percentage gain/loss without considering time. CAGR factors in the time period and shows annualized returns. For example, 100% absolute return over 5 years equals 14.87% CAGR, while 100% over 2 years equals 41.4% CAGR. CAGR is better for comparing investments over different time periods.

Is CAGR the same as average returns?

No. CAGR uses geometric mean (compounding), while average return uses arithmetic mean. CAGR is more accurate for investment performance. For example, if returns are +50% and -50%, average is 0%, but actual value decreased. CAGR would correctly show negative return.

Should I only look at CAGR when choosing investments?

No, while CAGR is important, also consider: 1) Volatility/risk, 2) Maximum drawdown, 3) Consistency of returns, 4) Expense ratio, 5) Fund manager track record. A 15% CAGR with 40% volatility might be riskier than 12% CAGR with 20% volatility.

How to calculate CAGR for SIP investments?

CAGR formula works for lumpsum investments. For SIP, use XIRR (Extended Internal Rate of Return) which accounts for multiple cash flows at different times. XIRR gives you the annualized return for SIP investments accurately.

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