Calculate Compound Annual Growth Rate, End Value, or Years needed — 3 modes in one tool.
What is CAGR?
CAGR (Compound Annual Growth Rate) is the rate at which an investment grows from its beginning value to its end value, assuming profits are reinvested each year. It smooths out volatility and gives you a single, comparable growth rate.
Formula: CAGR = (End Value / Begin Value) ^ (1 / Years) − 1
CAGR is widely used to compare investment returns, business revenue growth, and portfolio performance across different time periods.
Frequently Asked Questions
What is a good CAGR for investments?+
A CAGR of 10–15% is considered good for stock market investments. The S&P 500 has historically returned about 10% CAGR. For individual stocks, 15–25% CAGR over 5+ years is excellent.
How is CAGR different from average return?+
Average return adds up yearly returns and divides by years. CAGR accounts for compounding — it shows the actual rate needed to go from start to end value. CAGR is always more accurate for measuring real investment growth.
Can CAGR be negative?+
Yes. If your end value is less than the beginning value, CAGR will be negative, showing annual loss rate. This helps you understand how quickly an investment declined.
What is CAGR used for in business?+
Businesses use CAGR to report revenue growth, market size expansion, and compare performance against competitors. It's the standard metric in investor presentations and financial reports.