CAGR Calculator
One steady rate for an uneven journey.
Turn a starting value, an ending value and a time period into a compound annual growth rate, and see how it differs from a simple average.
- Free, no sign-up
- Runs in your browser
- Shareable results
- Educational only
Start, finish and time.
Can include decimals, for example 7.5.
CAGR smooths out the ups and downs. These are hypothetical assumptions for learning, not forecasts or expected results for any investment.
Result
The growth path implied by CAGR.
View the year-by-year table
What the numbers mean.
A smoothed yearly rate.
CAGR is the single steady rate that would take you from the start to the end. Real returns jump around, so the actual path differs.
Not the same as an average.
Adding yearly returns and dividing by the number of years gives an arithmetic average that usually overstates what you actually earned.
Compare like with like.
CAGR is useful for comparing investments over the same period. It says nothing about risk or the route taken.
About this cagr calculator.
A CAGR calculator turns a starting value, an ending value and a time period into one steady yearly growth rate. CAGR stands for compound annual growth rate. It answers the question: what rate, compounded each year, would take this investment from where it began to where it ended? That makes it a useful way to compare investments held for different lengths of time.
CAGR is not the same as an average of yearly returns, which overstates growth when returns swing. See compound interest examples to watch compounding at work, and dividend yield vs total return for how income affects growth. The glossary entry on compounding covers the basics, and the total return calculator adds dividends to the picture.
How the cagr calculator works in practice.
An investment grows from $10,000 to $25,000 over 8 years.
Growth multiple: 2.50x
CAGR: 12.14% a year
Simple average (150% ÷ 8): 18.75% a year
Years to double at this rate: 6.1
The simple average of 18.75% overstates the yearly rate by 6.61 points because it ignores compounding. The same method works for a loss: $10,000 falling to $7,000 over 5 years is a CAGR of −6.89% a year, not −6.00%. And doubling in 10 years is a CAGR of 7.18%.
How to choose your inputs.
Starting value. The value at the beginning of the period. Use the same currency and basis as the ending value.
Ending value. The value at the end, including reinvested income if you want a total-return figure.
Number of years. The length of the period. Decimals are fine, for example 7.5.
How the CAGR calculator works.
The calculator divides the ending value by the starting value, raises the result to the power of one over the number of years, and subtracts one.
Total growth = ending value ÷ starting value − 1
Years to double = ln 2 ÷ ln(1 + CAGR)
CAGR ignores deposits and withdrawals made along the way. If you added money during the period, use a money-weighted measure instead.
Limits of this cagr calculator.
CAGR smooths the path, so it hides the ups and downs in between and says nothing about risk. It ignores deposits and withdrawals, so for a portfolio you added to, it can mislead; use a money-weighted measure instead. A high CAGR over a short period is not a good guide to the future.
Common questions about the cagr calculator.
Is CAGR the same as average annual return?
No. The arithmetic average adds yearly returns and divides. CAGR accounts for compounding and is lower when returns vary.
Can CAGR be negative?
Yes. If the ending value is below the starting value, CAGR is negative.
Does CAGR include dividends?
Only if the ending value does. Use total values that include reinvested income for a fair comparison.
What if I added money along the way?
CAGR assumes no deposits or withdrawals. With contributions, the result would overstate or understate your performance.
What is the CAGR formula?
CAGR = (ending value ÷ starting value)^(1 ÷ years) − 1. The calculator does the arithmetic for you.
What is a good CAGR?
There is no single good figure. Compare it with an index, inflation and the risk you took. A figure is only meaningful against a benchmark over the same period.
How do I calculate annualized return?
For a single starting and ending value, the annualized return is the CAGR. If there are deposits or withdrawals, you need a different method.
Is CAGR the same as compound interest?
They use the same maths. CAGR works backwards from two values to a yearly rate, while compound interest works forward from a rate to a future value.
More calculators.
Educational illustration only. CAGR describes the past and does not predict future returns.
Further learning: Compound interest examples · Dividend yield vs total return · Glossary: Compounding · Investor.gov: Financial tools and calculators · Research methodology · Financial disclaimer