CAGR CalculatorTurn total return into a fair annualized growth rate
Enter investment data
Year-by-year growth
| Year | Value | Cumulative growth |
|---|---|---|
| 0 | 10,000 | 0 |
| 1 | 11,041 | 1,041 |
| 2 | 12,190 | 2,190 |
| 3 | 13,459 | 3,459 |
| 4 | 14,860 | 4,860 |
| 5 | 16,407 | 6,407 |
| 6 | 18,114 | 8,114 |
| 7 | 20,000 | 10,000 |
This tool is for educational estimation only. CAGR is a smoothed average and does not reflect actual yearly returns or guarantee future performance.
Why look at CAGR instead of just total return?
Suppose an investment grows from 10,000 to 20,000 over 7 years — that's a 100% total return, which sounds great. But if another investment doubled in just 3 years, which is better? Comparing total returns directly isn't fair, because the time periods differ. CAGR (Compound Annual Growth Rate) converts total return into "the equivalent steady percentage grown each year, compounded," putting investments of different lengths on the same footing.
How CAGR is calculated
The CAGR formula is (ending ÷ beginning) to the power of 1/n, minus 1, where n is the number of years. It assumes the value grows at a fixed compounded rate every year, so it traces a smooth curve rather than real year-to-year volatility. This tool also lists the year-by-year value so you can see how money rolls forward at that CAGR. For the full definition, see the Wikipedia article on compound annual growth rate.
What is it good for comparing?
CAGR is widely used to compare the long-term growth of stocks, funds, ETFs, real estate or a company's revenue, and to gauge your own portfolio's annualized performance. Remember that CAGR ignores the volatility and risk along the way, so pair it with our compound interest calculator and FIRE calculator for a more complete long-term financial plan.