CAGR Calculator
Find the Compound Annual Growth Rate of any investment over any period.
CAGR inputs
Enter starting value, ending value, and time period to estimate annualized growth.
Currency
Initial investment, revenue, portfolio, or metric value.
Final value after the selected time period.
Use decimals for partial years, such as 2.5.
Optional comparison rate.
CAGR
12.47%
Smoothed annual compound growth rate.
Ending value
£18,000.00
Starting from £10,000.00 over 5 years.
Total return
80.00%
Full percentage change over the entire period.
Absolute gain / loss
£8,000.00
Ending value minus beginning value.
Growth multiple
1.80×
Ending value divided by beginning value.
Simple annual average
16.00%
Total return divided by years, not compounded.
Annualized gain
£1,600.00
Average value change per year.
Benchmark difference
£3,974.48
Compared with 7.00% annual benchmark.
Support
Investment support layer
Formula based
Uses the standard compound annual growth rate formula from beginning value, ending value, and years.
Estimate only
CAGR is a simplified growth measure. It does not show volatility, risk, taxes, fees, or interim cash flows.
Comparison focused
Use CAGR to compare investments, business growth, revenue, portfolios, or metrics across different time periods.
Interpretation
What these CAGR results mean
Annualized growth
Your CAGR is 12.47%, meaning the value changed at a smoothed compound rate of about 12.47% per year.
Value change
The value moved from £10,000.00 to £18,000.00, a total change of £8,000.00.
CAGR vs average return
The simple annual average is 16.00%, but CAGR accounts for compounding over time.
Benchmark comparison
At the benchmark rate, the ending value would be about £14,025.52, which is £3,974.48 below your actual ending value.
Rule of 72 estimate
At this CAGR, the value would approximately double in 5.77 years using the Rule of 72.
Projection note
If the same CAGR continued for another 5 years, the ending value could project to about £32,400.00. This is only a mathematical projection.
CAGR basics
How CAGR works
Beginning value
The starting amount can be an investment, portfolio, revenue figure, user count, or other measurable value.
Ending value
The ending amount is the value after the selected number of years.
Time period
The number of years controls how the total growth is annualized.
Smoothed rate
CAGR smooths the journey into one compound annual rate, even if real growth varied year to year.
Comparison
CAGR vs total return
Total return
80.00%
Total return shows the full percentage change from beginning value to ending value across the whole period.
CAGR
12.47%
CAGR converts that total change into an annual compound rate, making time periods easier to compare.
Risk
What CAGR does not show
Volatility
CAGR does not show whether returns were smooth, volatile, or concentrated in a few years.
Drawdowns
Two investments can have the same CAGR but very different losses along the way.
Cash flows
Deposits, withdrawals, fees, taxes, and dividends must be included in the values if they should affect CAGR.
Use cases
Common CAGR use cases
Portfolio growth
Measure annualized growth from an initial investment to a final portfolio value.
Business revenue
Compare revenue growth across different periods or business units.
User growth
Annualize customer, subscriber, or active user growth.
Fund comparison
Compare funds or strategies over the same time horizon.
Market benchmarks
Compare performance against a benchmark annual return.
Long-term planning
Estimate what a value might become if a growth rate continues.
Formula
CAGR formula explanation
CAGR
CAGR = (Ending Value / Beginning Value)^(1 / Years) − 1CAGR estimates the smoothed compound annual rate needed to grow from the beginning value to the ending value.
Total return
Total Return = (Ending Value − Beginning Value) / Beginning ValueTotal return measures the full percentage gain or loss over the whole period.
Growth multiple
Growth Multiple = Ending Value / Beginning ValueGrowth multiple shows how many times larger or smaller the ending value is compared with the beginning value.
FAQ
CAGR calculator questions
CAGR stands for Compound Annual Growth Rate. It shows the smoothed annual rate that connects a beginning value to an ending value over a period of time.