INVESTING
Yearly Growth Rate Calculator (CAGR)
CAGR means average yearly growth rate. It smooths the ups and downs into one yearly number.
Your investment values
How much you originally put in, or what the investment was worth at the start.
What the investment is worth now, or what you sold it for.
Use decimals for part-years, such as 2.5 for two and a half years. CAGR does not show year-by-year ups and downs.
ANNUALIZED RETURN (CAGR)
14.7% p.a.
over 8 years
The average yearly growth rate is 14.7%.
Absolute return
200.0%
Total gains
₹2.00 Lakh
Initial value
₹1.00 Lakh
Final value
₹3.00 Lakh
What this means
Your investment grew from ₹1.00 Lakh to ₹3.00 Lakh, a 200.0% absolute return over 8 years. CAGR smooths that into 14.7% per year.
What can change this
CAGR does not show volatility, taxes, fees, dividends, rent, or extra cash flows added or withdrawn during the period.
What to check next
Use XIRR instead if money moved in or out on different dates, such as SIPs, rent, EMIs, or partial withdrawals.
Costs and assumptions
This estimate is based only on the information entered here.
Using CAGR to compare investments
CAGR vs absolute return
An investment that doubled in 10 years shows a 100% absolute return but only a 7.2% CAGR. CAGR adjusts for time, so it can help compare investments held for different durations — for example, a 5-year FD versus a 7-year fund or a property held for 12 years.
Use CAGR carefully
CAGR is a comparison tool, not a guarantee. It does not include taxes, fees, brokerage, exit loads, rent, dividends, or cash flows unless those are already reflected in your starting and ending values.
When to use this calculator
- Comparing one starting value and one ending value over time.
- Checking average yearly growth for a fund, FD, stock, property, or gold value.
- Understanding the difference between total return and annualized return.
- Keeping the calculation simple when no money was added or withdrawn in between.
Example calculation
Suppose an investment grows from ₹1 lakh to ₹3 lakh over 8 years. Absolute return shows the total change. CAGR converts that full-period growth into an average yearly growth rate, making it easier to compare with another investment held for a different number of years.
How this estimate is calculated
This shows the simplified method used for the estimate. It is meant for transparency, not as a full financial model.
Formula
Scroll sideways if the formula is wider than the screen.
Assumption: Assumes compounded annual growth. No intermediate cash flows.
CAGR smooths volatility and does not include interim cash flows, tax, brokerage, exit loads, product costs, dividends, or rent unless those are already reflected in the values entered.
Frequently asked questions
What is CAGR?
What is the difference between CAGR and absolute return?
When should I use CAGR?
When should I use XIRR instead?
Does CAGR include tax or fees?
Can CAGR predict future returns?
Educational estimate only. This calculator uses simplified assumptions based on your inputs. Actual outcomes may differ because of market returns, taxes, fees, inflation, product rules, exit penalties, lender charges, and personal circumstances. This is not financial, investment, tax, or legal advice. Returns are not guaranteed. Taxes, exit loads, premature withdrawal penalties, expense ratios, lock-in rules, and other product-specific charges are not included unless explicitly shown.