CAGR Calculator
Calculate compound annual growth rate from initial value, final value and duration.
About CAGR Calculator
CAGR Calculator expresses growth between an initial and final value as one equivalent annual rate. It is helpful when you want to compare values measured over different multi-year periods, such as a starting investment and its later balance, or a business metric at the beginning and end of a reporting period.
CAGR stands for compound annual growth rate. It smooths the complete change into a hypothetical steady path; it does not report the actual return in each year. Enter positive starting and ending values and a duration in years. Alongside the annualized percentage, the tool shows the absolute change and growth multiple, so you can distinguish the rate from the total amount gained or lost.
How to use CAGR Calculator
- Enter the starting value
Set Initial investment to a positive beginning amount.
- Enter the ending value
Set Final value using the same units or currency.
- Set the duration
Enter the elapsed Duration in years; use a decimal if the period is not a whole number of years.
- Read the comparison
The result updates automatically. Compare CAGR with Absolute growth and Growth multiple.
Example: Two years of growth
An initial value of ₹100,000 and a final value of ₹121,000 over 2 years give 10.00% CAGR, ₹21,000 absolute growth and a 1.21× growth multiple. This does not mean each actual year gained exactly 10%.
How it works
The formula is CAGR = ((final value / initial value)^(1 / years) − 1) × 100. The ratio first measures the total growth multiple. Taking its root for the chosen duration finds the constant yearly multiplier that would connect the endpoints. Subtracting 1 and multiplying by 100 expresses that multiplier as an annual percentage. All three inputs must be greater than zero in this implementation.
A final value below the starting value produces a negative CAGR, even though both inputs are positive. The rate summarizes the endpoints and duration only: it cannot reveal a sharp rise followed by a fall, nor distinguish growth from extra deposits included in the final balance. For investments with cash flows in between, an endpoint CAGR is not a cash-flow-adjusted return calculation. The absolute-growth result is the final amount minus the starting amount; the growth multiple is their ratio.
When is this useful?
- Annualize a multi-year change between two comparable values.
- Compare growth periods of different lengths.
- Distinguish annualized growth from total absolute gain.
Things to know
- Zero and negative endpoint values are not supported.
- Intermediate deposits, withdrawals and year-to-year volatility are not modeled.
- The result is historical or hypothetical, not a prediction of future growth.
Privacy & processing
The starting value, final value and duration are evaluated locally in this browser. The tool does not look up market prices or send these values to a financial-data API.
Frequently asked questions
Does CAGR show what happened each year?
No. It shows one steady annual rate that connects the two endpoints; actual yearly changes can differ greatly.
Can the result be negative?
Yes. A positive ending value lower than the positive starting value produces a negative growth rate.
Can I use a period such as 2.5 years?
Yes. Duration accepts a positive number of years, including a fractional value.
What if I added money during the period?
CAGR does not separate deposits from returns. A final balance containing new contributions can overstate growth attributable to the original investment.