CAGR Calculator (Compound Annual Growth Rate)

CAGR (Compound Annual Growth Rate) tells you the smoothed annual rate of return for an investment over a period longer than one year. Unlike simple average returns, CAGR accounts for compounding, giving you a more accurate picture of investment performance. It is the standard metric for comparing investment returns across different time periods.

How to Use This Tool

Enter the starting value of your investment.
Enter the ending (current) value of your investment.
Enter the total time period in years (use decimals for months, e.g., 2.5 for 2 years and 6 months).
Click Calculate to see the CAGR and total return percentage.

The Formula

CAGR = (Ending Value / Beginning Value)^(1 / Number of Years) - 1 This gives the constant annual rate that would grow the beginning value to the ending value over the given period.

Why It Matters

You invested $10,000 in a diversified stock portfolio 5 years ago, and it is now worth $25,000. Your friend invested in a crypto fund that went from $10,000 to $20,000 in 3 years. Use CAGR to compare the two investments on an equal footing — it smooths out volatility to give a true annual return rate.