CAGR Calculator
Compute compound annual growth rate between an initial and final investment value.
Starting investment value.
Ending investment value.
Investment holding period.
CAGR smooths volatile year-by-year returns into a single annualised rate. It assumes profits were reinvested and does not reflect interim cash flows (deposits or withdrawals). Estimates only.
What is CAGR?
Compound Annual Growth Rate is the constant annual rate at which an investment would have grown from its beginning balance to its ending balance, assuming reinvestment of gains.
CAGR vs absolute return?
Absolute return is (final − initial) / initial. CAGR accounts for the time period, making it easier to compare investments held for different durations.
Can CAGR be negative?
Yes — if the final value is less than the initial value, CAGR is negative, indicating an overall loss over the period.
Does CAGR include dividends?
Only if dividends were reinvested and reflected in the final value. If you withdrew dividends, the ending value understates total return.
Why use years for the period?
The formula exponent is 1/years. Months are converted to fractional years internally (months ÷ 12).