Returns & Growth
CAGR Calculator
Find your Compound Annual Growth Rate, project future value at a target CAGR, or work out the CAGR you need to hit a goal — with absolute return shown side by side so the two numbers never get confused.
Choose What to Calculate
Results
Why absolute return and CAGR look so different
A 100% absolute return over 6 years sounds dramatic, but spread evenly across every year it is really just 12.25% CAGR — steady annual compounding, not an overnight windfall. This is the “comparability trap”: a 100% return over 6 years, for instance, is only about 12.2% CAGR. Always compare investments held for different durations using CAGR, never raw absolute return.
Value Growth Over Time
Illustrative year-by-year value assuming a steady 12.25% annual growth rate — real markets rarely move in a straight line
How Does This Compare?
Broad reference ranges for common asset classes — illustrative historical ranges, not guarantees. Past performance does not indicate future returns.
| Asset Class | Illustrative CAGR |
|---|---|
| Fixed Deposit (FD) | ~7% p.a. |
| Gold | ~9% p.a. |
| Nifty 50 (equity) | ~12% p.a. |
| Your CAGR (Annualized Return) | 12.25% p.a. |
Year-by-Year Growth
Projected value at a steady 12.25% annual rate
| Year | Value | Gain So Far | Growth % |
|---|---|---|---|
| Yr 0 | ₹5.00 L | ₹0 | 0.0% |
| Yr 1 | ₹5.61 L | ₹61,231 | 12.2% |
| Yr 2 | ₹6.30 L | ₹1.30 L | 26.0% |
| Yr 3 | ₹7.07 L | ₹2.07 L | 41.4% |
| Yr 4 | ₹7.94 L | ₹2.94 L | 58.7% |
| Yr 5 | ₹8.91 L | ₹3.91 L | 78.2% |
| Yr 6 | ₹10.00 L | ₹5.00 L | 100.0% |
CAGR formula: CAGR = (Ending Value ÷ Beginning Value)(1 ÷ Years) − 1. It is the single steady annual rate that, compounded every year, takes you from the starting amount to the ending amount — useful for comparing investments held for different lengths of time on a like-for-like basis.
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Calculator results are for illustration purposes only. Actual returns may vary based on market conditions, fund performance, and other factors. Mutual fund investments are subject to market risks. Read all scheme-related documents carefully before investing. Past performance does not guarantee future returns.
CAGR — the honest way to state a return over years
CAGR (Compound Annual Growth Rate) is the single smoothed annual rate that would take an investment from its starting value to its ending value over a number of years. It strips out the messy year-to-year swings and answers a clean question: at what steady annual rate did this grow? That makes it the fair way to compare investments held for different periods.
This calculator computes CAGR from a start value, an end value and the number of years. Two cautions: CAGR hides the volatility along the way (two funds with the same CAGR can have had very different rides), and it assumes a single lump sum — for investments with ongoing contributions or withdrawals, XIRR is the right measure instead.
How this calculator works
- 1Enter the starting value, the ending value and the number of years held.
- 2The calculator applies CAGR = (End / Start)^(1/years) − 1.
- 3It returns the smoothed annual growth rate.
Frequently asked questions
What is CAGR?
CAGR is the constant annual rate at which an investment would have grown from its start value to its end value over a given number of years, assuming the growth compounded steadily. It is calculated as (End ÷ Start) raised to the power of (1 ÷ years), minus one.
How is CAGR different from absolute return?
Absolute return is the total percentage gain over the whole period, ignoring time — so a 50% absolute return over 2 years and over 10 years look identical. CAGR annualises the gain, so it tells you the yearly rate and lets you compare investments held for different lengths of time fairly.
When should I use XIRR instead of CAGR?
Use CAGR for a single lump sum with one start and one end value. Use XIRR when there are multiple cash flows at different dates — like a SIP, or a portfolio with additions and withdrawals — because CAGR cannot account for the timing and size of each cash flow, but XIRR can.
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Illustrative only; past returns do not guarantee future results.
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