CAGR Calculator
Measure the annualized performance of your business assets or mutual funds. Input the initial value, final valuation, and years to calculate the exact compound annual growth.
Parameters
Results Summary
Your investment grew by an annualized rate of 20.11% over 5 years to reach $25,000.
This calculator determines the results based on the following standard financial formula for Compound Annual Growth Rate (CAGR):
Variables Glossary
- CAGR
- Compound Annual Growth Rate (percentage)
- EV
- Ending Value of the asset/investment
- SV
- Starting Value of the asset/investment
- n
- Number of years
By taking the root of ending value divided by starting value, we find the geometric mean rate of return per period.
What is CAGR?
Compound Annual Growth Rate (CAGR) represents the smoothed annual growth rate of an investment as if it grew at a steady compounding rate over the specified time period.
How is CAGR different from simple average return?
Simple average return ignores compounding, adding annual growth percentages and dividing by years. CAGR takes compounding into account, explaining what the exact steady rate of return was from start to end.