CAGR Calculator
Find the compound annual growth rate of an investment, a business or any metric
What do you want to calculate?
Decimals are fine, e.g. 2.5
A return to compare against
Compound annual growth rate
13.70%
$10,000 growing at 13.70% a year becomes $19,000 after 5 years.
CAGR
13.70%
per year, compounded
Total return
90.0%
$9,000 gain
Simple average return
18.00%
total return ÷ years, no compounding
Doubling time
5.4 years
at this CAGR
Dividing the 90.0% total return evenly over 5 years gives 18.00% a year, but because growth compounds, the true annual rate is 13.70%.
The benchmark at 7.0% would turn $10,000 into $14,026 over the same period, so your result beats the benchmark by $4,974.
Year-by-Year Growth
| Year | Value at CAGR | Straight-Line Value | Benchmark Value | vs Benchmark |
|---|---|---|---|---|
| 0 | $10,000 | $10,000 | $10,000 | $0 |
| 1 | $11,370 | $11,800 | $10,700 | $670 |
| 2 | $12,927 | $13,600 | $11,449 | $1,478 |
| 3 | $14,698 | $15,400 | $12,250 | $2,447 |
| 4 | $16,711 | $17,200 | $13,108 | $3,603 |
| 5 | $19,000 | $19,000 | $14,026 | $4,974 |
About CAGR
The compound annual growth rate is the steady yearly rate that would take a starting value to an ending value over a period, as if growth compounded smoothly. It turns a bumpy history into one comparable number, which makes it useful for comparing investments, revenue growth or any metric measured over different lengths of time.
The Formulas
CAGR = (EV ÷ BV)^(1/n) − 1
EV = BV × (1 + CAGR)^n
n = ln(EV ÷ BV) ÷ ln(1 + CAGR)
BV = beginning value, EV = ending value, n = years
Using CAGR Well
- •Use CAGR to compare investments held for different lengths of time
- •CAGR hides volatility: two investments with the same CAGR can carry very different risk
- •With deposits or withdrawals along the way, use an IRR calculation instead
- •A crash or a peak at the start or end date can skew CAGR, so test other date ranges
- •Compare against a benchmark, such as an index fund, over the same period