ToolFoxCAGR Calculator
Find the Compound Annual Growth Rate between an initial and final investment value.
- CAGR
- 14.87%
- Initial value
- ₹1,00,000
- Final value
- ₹2,00,000
How it works
CAGR smooths an investment's growth into a single steady annual rate: CAGR = ((final value ÷ initial value) ^ (1 ÷ years) − 1) × 100. It answers "what constant yearly return would have produced this same result", even though real returns fluctuate year to year. A final value below the initial one produces a negative CAGR.
Example
₹1,00,000 growing to ₹2,00,000 over 5 years has a CAGR of about 14.87% — meaning it behaved as if it compounded at 14.87% every year, even if the actual year-to-year path was bumpy. The reverse, ₹2,00,000 falling to ₹1,00,000 over 5 years, is a CAGR of about −12.94%.
Frequently asked questions
Is CAGR the same as average annual return?
No — a simple average of yearly returns ignores compounding and can overstate performance. CAGR always reflects the true compounded path from start to finish.
Does CAGR show volatility?
No — two investments with the same CAGR can have very different ups and downs along the way; CAGR only compares the start and end points.
Can years be a fraction, like 2.5?
Yes — the formula works for any positive number of years, including fractional periods.
What does a negative CAGR mean?
The investment lost value overall — the final amount is lower than the initial one, so the equivalent constant yearly rate is negative.
Related tools
Estimate the future value of a monthly SIP in mutual funds, with invested amount and gains.
FD CalculatorCalculate fixed deposit maturity value and interest with quarterly compounding, as Indian banks do.
RD CalculatorEstimate the maturity value and interest on a recurring monthly bank deposit.