CAGR Calculator
CAGR (Compound Annual Growth Rate) is the single most useful metric for comparing investment performance over time. Use this calculator to find the CAGR between two values, project a future value at a given CAGR, or find out how many years it takes to grow an investment to a target.
Frequently Asked Questions
What is CAGR and why is it useful?+
CAGR (Compound Annual Growth Rate) is the steady-state rate at which an investment would have grown if it compounded at a constant rate each year. It smooths out year-to-year volatility and lets you compare the performance of different investments over different time periods on a like-for-like basis.
What is the difference between CAGR and absolute return?+
Absolute return is the total percentage change (e.g., +150% over 10 years). CAGR annualises that return (≈9.6%/year). A 100% absolute return over 2 years is a 41.4% CAGR; the same 100% over 10 years is only a 7.2% CAGR. CAGR allows fair comparison.
What is a good CAGR for mutual funds in India?+
Equity mutual funds in India have historically delivered 12–16% CAGR over 10+ year periods. Large-cap funds average 12–14%; small/mid-cap funds 14–18% (with higher volatility). Fixed income instruments (FD, PPF, bonds) typically deliver 6–8% CAGR.
Does CAGR account for inflation?+
Nominal CAGR does not. Real CAGR = (1 + Nominal CAGR) / (1 + Inflation Rate) − 1. For a 12% nominal CAGR with 6% inflation, real CAGR ≈ 5.66%. Always evaluate long-term investments against inflation-adjusted returns.