CAGR Calculator

Calculate the Compound Annual Growth Rate (CAGR) of your investments to understand their annualized growth rate over time.

Years
%
Optional: For calculating inflation-adjusted CAGR
CAGR Calculation Results
Initial Investment

₹ 1,00,000

Final Value

₹ 2,00,000

CAGR

14.87%

Compound Annual Growth Rate
Real CAGR

8.37%

Inflation-adjusted CAGR
Investment Growth Visualization
Detailed Breakdown
Parameter Value
Initial Investment ₹ 1,00,000
Final Investment Value ₹ 2,00,000
Investment Period 5 years
Absolute Growth 100.00%
CAGR 14.87%
Inflation Rate 6.00%
Real CAGR (Inflation-adjusted) 8.37%
Inflation-adjusted Final Value ₹ 1,49,386
Year-by-Year Breakdown
Year Investment Value Year-on-Year Growth Inflation-adjusted Value
Understanding CAGR
What is CAGR?

Compound Annual Growth Rate (CAGR) is a measure of the annual growth rate of an investment over a specified time period longer than one year. It represents the smoothed annualized gain you earned over your investment time horizon.

CAGR Formula

CAGR = (Final Value / Initial Value)1/n - 1

Where:

  • Final Value = Ending investment value
  • Initial Value = Beginning investment value
  • n = Number of years
Real CAGR Formula (Inflation-adjusted)

Real CAGR = [(1 + CAGR) / (1 + Inflation Rate)] - 1

This formula gives you the growth rate of your investment in terms of purchasing power.

When to Use CAGR
  • Comparing Investments: CAGR helps compare the performance of different investments over the same time period
  • Evaluating Fund Performance: Assess mutual funds, stocks, or portfolio performance
  • Business Growth Analysis: Analyze company revenue, profit, or market share growth
  • Long-term Planning: Project future values based on historical growth rates

Note: CAGR smooths out volatility and provides a single growth rate, but it doesn't show the path of growth or account for interim volatility.

About CAGR Calculator

Our CAGR Calculator helps you determine the annualized growth rate of your investments over time. It's a powerful tool for:

  • Comparing different investment options
  • Evaluating the performance of your portfolio
  • Understanding the real (inflation-adjusted) growth of your investments
  • Planning for future financial goals

CAGR provides a "smoothed" growth rate that helps you understand how your investments have performed on an annualized basis, regardless of year-to-year volatility.

CAGR vs. Absolute Returns
CAGR Absolute Returns
Annualized growth rate Total growth over entire period
Accounts for compounding Doesn't account for compounding
Useful for comparing investments with different time horizons Only useful for comparing investments with identical time horizons
Expressed as an annual percentage Expressed as a total percentage

Example: An investment that doubles in 10 years has an absolute return of 100% but a CAGR of only 7.18%.

CAGR Benchmarks in India

For reference, here are typical CAGR ranges for different asset classes in India (historical averages):

  • Equity (Nifty 50): 12-15% (long-term)
  • Debt (Government Securities): 6-8%
  • Gold: 8-10%
  • Real Estate: 8-12% (location dependent)
  • Fixed Deposits: 5-7%
  • Public Provident Fund (PPF): 7-8%

Remember: Past performance is not indicative of future returns. These are historical averages and actual returns may vary significantly.

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