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CAGR Calculator — Compound Annual Growth Rate

Calculate the CAGR of your investments. Understand the consistent annual growth rate that turns your initial investment into its final value.

CAGR Details
₹
₹
Yr
1 Yr30 Yr

CAGR

20.11%

Absolute Return

150.0%

Total Gain

₹1,50,000

Value Growth at CAGR

Understanding CAGR for Indian Investors

CAGR is the gold standard for measuring investment performance in India. When a mutual fund advertises "15% returns over 10 years," they are referring to CAGR. It tells you the smoothed annual rate at which your investment grew, eliminating the noise of year-to-year fluctuations. For Indian equity markets, the Nifty 50 has delivered approximately 12-13% CAGR over 20+ year periods. This is a useful benchmark to compare your investment performance.

Formula & How It Works

Formula
CAGR = (Final Value / Initial Value)^(1/n) − 1

Where n is the number of years. CAGR smooths out volatility to show a single annualized growth rate.

CAGR is the most common metric to compare investment performance across different asset classes and time periods.

Worked Example

Initial investment: ₹1,00,000. Final value after 5 years: ₹2,50,000.

CAGR = (2,50,000/1,00,000)^(1/5) − 1 = 20.11%.

This means your investment grew at a consistent 20.11% per year (compounded).

Benefits of Using CAGR Calculator

Compare performance across different investments (stocks, mutual funds, real estate).

Smooths out volatile year-to-year returns into a single meaningful number.

Industry-standard metric used by mutual fund houses and financial advisors.

Helps set realistic return expectations for future investments.

Common Mistakes to Avoid

Confusing CAGR with average return — CAGR accounts for compounding, average does not.

Using CAGR for very short periods (< 3 years) where it may be misleading.

Assuming past CAGR will continue — especially for individual stocks.

Not comparing CAGR with benchmark indices to assess relative performance.

Frequently Asked Questions

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