📈 CAGR Calculator
Find your investment's true annualized return.
How This Is Calculated
CAGR = (Ending Value ÷ Starting Value)^(1 ÷ Years) − 1. Example: $10,000 growing to $18,000 over 5 years = (1.8)^(1/5) − 1 ≈ 12.47% annualized return — even though the actual year-to-year returns may have varied significantly.
Frequently Asked Questions
What is CAGR and why does it matter?
CAGR smooths an investment's growth into a single annualized percentage, even if actual year-to-year
returns were volatile. It's the standard way to fairly compare investments held over different time periods.
Guide: understanding your result
- CAGR = (Ending value ÷ Beginning value)^(1 ÷ years) − 1.
- CAGR describes a smoothed annual growth rate; it hides the ups and downs in between.
- It ignores additional contributions or withdrawals — use a money-weighted return when cash flows occurred.
Worked example
A value that grew from $10,000 to $25,000 in 7 years has a CAGR of 13.99%, even though the total growth was 150%.
Common mistakes to avoid
- Dividing total growth by the number of years (simple average) instead of using CAGR.
- Comparing CAGRs over different periods.
Frequently asked questions
Is a past CAGR a forecast?
No. It describes what happened over a specific period; it does not predict future results and is not investment advice.
Official sources
Examples are calculated live from the same data the calculator uses and are for education only — they are not financial, tax or investment advice.
More Finance calculators
See all →✔ Reviewed by GelirLab Editöryal Ekibi · How we check our calculators