PuneInvest/CAGR Calculator

CAGR Calculator — Compute Compound Annual Growth Rate Online

Free CAGR calculator to compute Compound Annual Growth Rate for your investments. Calculate absolute returns, growth multiple, and projected yearly values.

What is a CAGR Calculator?

A CAGR Calculator (Compound Annual Growth Rate Calculator) is a financial tool that computes the annualized rate of return on an investment over a specified period. Unlike absolute returns which show total growth, CAGR smooths out volatility and shows the consistent yearly growth rate required to reach the final value from the initial investment.

It is the most widely used metric for comparing the performance of different investments — mutual funds, stocks, real estate, or fixed deposits — because it annualizes returns regardless of the investment tenure.

How to Use the CAGR Calculator

1

Enter Initial Investment Value

Input the amount you initially invested. You can use preset buttons (₹10K, ₹50K, ₹1L, ₹5L, ₹10L) or enter a custom amount.

2

Enter Final/Current Value

Enter the current or maturity value of your investment. Use presets to see common growth multiples (2x, 3x, 5x).

3

Set Investment Duration

Select the number of years the investment was held. Longer durations will show lower CAGR for the same absolute return.

4

View Results Instantly

The calculator instantly shows the CAGR, absolute return percentage, and growth multiple. The donut chart and year-by-year projection give complete visibility.

CAGR Formula

CAGR (%) = [(Final Value ÷ Initial Value)^(1 ÷ n) - 1] × 100
Final Value= Ending value of investment
Initial Value= Beginning value of investment
n= Number of years

Worked Example — ₹1,00,000 Growing to ₹2,00,000 in 5 Years

Initial Value: ₹1,00,000
Final Value: ₹2,00,000
Duration: 5 years
CAGR = [(2,00,000 ÷ 1,00,000)^(1÷5) - 1] × 100
CAGR = [2^(0.2) - 1] × 100
CAGR = [1.1487 - 1] × 100
CAGR = 14.87%
Initial Value
₹1,00,000
Absolute Return
100%
CAGR
14.87%

CAGR vs Absolute Return

FeatureCAGRAbsolute Return
DefinitionAnnualized rate of returnTotal percentage gain over full period
Formula(FV/IV)^(1/n) - 1(FV - IV)/IV × 100
Time-AdjustedYes — accounts for tenureNo — lumpsum percentage
Comparing InvestmentsCan compare across different tenuresOnly valid for same tenure
Example: ₹1L → ₹2L in 5Y14.87%100%
Best UsePerformance comparison, goal planningSimple profit/loss assessment

Frequently Asked Questions

What is CAGR?
CAGR stands for Compound Annual Growth Rate. It is the mean annual growth rate of an investment over a specified period longer than one year. It represents one of the most accurate ways to calculate and determine returns for individual assets and investment portfolios.
How is CAGR calculated?
CAGR is calculated using the formula: CAGR = (Final Value / Initial Value)^(1/n) - 1, where n is the number of years. For example, if an investment of ₹1,00,000 grows to ₹2,00,000 in 5 years, CAGR = (2,00,000/1,00,000)^(1/5) - 1 = 14.87%.
What is the difference between CAGR and absolute return?
Absolute return shows the total percentage gain over the entire period, while CAGR shows the annualized rate. An investment growing 100% over 5 years has absolute return of 100% but CAGR of only 14.87%.
What is a good CAGR for mutual funds?
Historically, large-cap funds deliver 10-12% CAGR, mid-cap funds 12-15%, and small-cap funds 15-18% over long term. A CAGR above 15% is considered excellent for equity investments.
Can CAGR be negative?
Yes, CAGR can be negative if the final value is less than the initial value. A negative CAGR means the investment has lost value over the period on an annualized basis.
What is the difference between CAGR and IRR?
CAGR assumes smooth, steady growth, ignoring volatility. IRR (Internal Rate of Return) accounts for irregular cash flows and timing. CAGR is best for lump-sum investments, while IRR is better for SIPs.

Disclaimer

The CAGR calculator is for informational and educational purposes only. It provides estimated returns based on the CAGR formula and does not guarantee future performance. Actual returns may vary due to market conditions and other factors. Past performance does not guarantee future results.

Related Calculators

SIP Calculator

Free online SIP Calculator to calculate expected returns on monthly mutual fund Systematic Investment Plan. View invested amount, wealth gain & maturity value with compound interest formula.

Step-Up SIP Calculator

Free online Step-Up SIP Calculator with annual increment. See how increasing your SIP by 10-15% yearly can double your mutual fund corpus. Year-by-year breakdown included.

Lumpsum Calculator

Project compounding on a single initial deposit

Mutual Fund Returns Calculator

Estimate absolute and annualized returns on MF investments

SWP Calculator

Model Systematic Withdrawal Plans for retirement income

Cost of Delay Calculator

Visualize wealth lost by postponing investments