CAGR Calculator

Find the annual growth rate of any investment in seconds. Enter the Initial Investment, Final Investment and Duration of Investment.

CAGR calculator hero graphic – upward bar chart.

Years
CAGR result

Your CAGR return is

— %

Discuss Exit Strategy

What Is CAGR?

CAGR stands for Compounded Annual Growth Rate. It tells you the average yearly pace at which an investment grew from the initial investment value to the final investment value, as if the growth were smooth and steady every year.

How to Calculate CAGR?

The maths behind the tool is simple:

CAGR = (Final Investment ÷ Initial Investment)(1 ÷ Total Duration) − 1

Example: ₹10 lakh becomes ₹18 lakh in 5 years.
CAGR = (18 ÷ 10)1/5 – 1 ≈ 12.47 % per year.

How to Use This CAGR Calculator

  1. Enter the Intinal Investment Value of your investment (e.g. ₹10 lakh).
  2. Add the Final Investment value today (e.g. ₹18 lakh).
  3. Type the exact holding period in years (decimals like 7.5 work fine).
  4. Press Enter or click anywhere - the calculator shows your CAGR % and total gain.

What Is a Good CAGR?

A quick rule of thumb:

  • More than 10 % CAGR is usually considered good in many cases.
  • For equity investments, a CAGR of about 15 – 30 % is often seen as healthy.
  • For fixed‑income products, a CAGR of roughly 8 – 12 % is common.

Whether a return is “good” also depends on your goal, time frame, and risk comfort. Unsure where you stand? Pop your numbers into the calculator above and check your own CAGR.

CAGR vs. Absolute Return - What’s the Difference?

  • CAGR shows the smoothed yearly growth rate of your money.
  • Absolute Return is the total percentage gain, regardless of years taken.
  • Example: ₹10 lakh → ₹18 lakh in 5 years equals 80 % absolute but only 12.47 % CAGR.
  • When comparing two investments, always put them on equal footing by looking at CAGR.

CAGR vs. Absolute Return

  • Absolute Return shows total gain (₹ gain or % gain) over the whole period.
  • CAGR smooths that gain into a yearly rate, making it easier to compare 3‑, 5‑, or 10‑year investments.

CAGR vs. XIRR

CAGR works when there is one cash flow in (lump‑sum buy) and one cash flow out (sell). If you have multiple buys or monthly SIPs, use our XIRR Calculator instead.

When Is CAGR Most Useful?

  • Comparing mutual‑fund performance across different time frames.
  • Benchmarking equity vs. real‑estate returns.
  • Setting target growth rates for long‑term goals such as retirement or a child’s education.

FAQs

1. Is a higher CAGR always better?

2. Can CAGR be negative?

3. Does CAGR include dividends?

4. How accurate is this online tool?

5. What’s next after finding my CAGR?

" "