CAGR Calculator — Calculate Compound Annual Growth Rate | CalculHub
CAGR Calculator
CAGR Results
CAGR (Compound Annual Growth Rate)
20.11%Absolute Return
150.00%Total Gain
₹150,000CAGR Calculator — Calculate Compound Annual Growth Rate
The CAGR Calculator (Compound Annual Growth Rate Calculator) helps investors, analysts, and students determine the mean annual growth rate of an investment over a specified time period, assuming the profits are reinvested at the end of each period. CAGR is the most widely used metric for evaluating the performance of stocks, mutual funds, businesses, and any investment where you know the starting value, ending value, and time span.
Unlike absolute return (which only tells you how much something grew in total), CAGR annualises the return, allowing fair comparison between investments of different durations.
CAGR Formula
- Final Value = Ending value of the investment
- Initial Value = Starting value of the investment
- n = Number of years (time period)
Example: ₹1,00,000 grows to ₹2,50,000 in 5 years. CAGR = (2,50,000/1,00,000)^(1/5) − 1 = 20.11%.
CAGR vs Absolute Return vs XIRR
| Metric | What It Measures | Best Used For |
|---|---|---|
| CAGR | Annualised return assuming single investment | Comparing stocks, FDs, and long-term investments |
| Absolute Return | Total percentage change over entire period | Short-term performance overview |
| XIRR | Annualised return with multiple cash flows | SIP investments, irregular cash flows |
CAGR of Popular Asset Classes in India (Historical)
| Asset Class | 5-Year CAGR | 10-Year CAGR | 15-Year CAGR |
|---|---|---|---|
| Nifty 50 (Equity) | ~14–16% | ~12–14% | ~12–13% |
| Large-Cap Mutual Funds | ~12–15% | ~11–13% | ~11–12% |
| Gold | ~10–13% | ~8–10% | ~10–12% |
| Fixed Deposits | ~6–7% | ~6–7% | ~6–7% |
| Real Estate | ~5–8% | ~6–9% | ~7–10% |
Historical CAGR figures are approximate and not indicative of future performance.
Frequently Asked Questions — CAGR Calculator
What is a good CAGR for mutual funds?
For equity mutual funds, a CAGR of 12–15% over a 10-year period is generally considered strong. Anything above 15% is excellent. For debt funds, 6–8% CAGR is typical. Always compare the fund's CAGR against its benchmark index.
What is the difference between CAGR and IRR?
CAGR assumes a single investment with no additional cash flows. IRR (Internal Rate of Return) works with multiple uneven cash flows. For SIP investments, XIRR is used — which is IRR applied to dated cash flows.
Can CAGR be negative?
Yes. If the final value is less than the initial value, the CAGR will be negative — indicating the investment lost value on an annualised basis. For example, if ₹1,00,000 became ₹70,000 in 3 years, CAGR = −11.04%.
How is CAGR different from average annual return?
Average annual return is the simple arithmetic mean of yearly returns. CAGR is the geometric mean — it accounts for compounding and is always lower than the arithmetic average when there is volatility. CAGR is the more accurate representation of actual investor returns.