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finance calculator
Calculate compound annual growth rate between two values.
Save this tool to analyze portfolio performance, business revenue trends, or asset appreciation over multiple years.
CAGR
8.45%
Summary
CAGR Return
8.45%
Compound annual growth rate.
Total growth
50.0%
Simple total percent return.
Start value
$10,000
Beginning asset value.
Ending value
$15,000
Closing asset value.
D3 visualization
Start value vs end value shows the absolute expansion of your investment.
D3 visualization
The simulated year-by-year value path, showing how the investment grows at the calculated CAGR.
Guide
CAGR represents the smoothed annual rate of return required for an investment to grow from its initial balance to its final balance, assuming profits are compounded annually.
Unlike a simple average, CAGR accounts for compounding, making it a highly useful tool for comparing the returns of different assets or portfolios over identical time frames.
CAGR is a representative metric that assumes steady growth. Real investments fluctuate, experiencing volatile up and down periods. CAGR is best used to summarize long-term trends rather than track year-to-year volatility.
Compounding
The process where an asset's earnings are reinvested to generate additional earnings over time.
Annualized return
The geometric average amount of money earned by an investment each year over a given time period.
CAGR = (Ending Value / Beginning Value) ^ (1 / Years) - 1. It calculates the annual return assuming compound growth.
Yes. If the ending value is lower than the beginning value, CAGR will be negative, representing an annual loss.
Formula
CAGR = (End / Start)^(1 / Years) - 1CAGR smooths total growth into an annualized rate.
Step by step
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