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Investmentreturns

CAGR Calculator

Compound annual growth rate, with the real return and the effect of contributions. CAGR is a smoothed rate describing two endpoints, so it says nothing about the path, and adding money along the way makes the simple root overstate.

Also called: compound annual growth rate calculator, annualised return calculator.

₹
₹
₹
%
%
CAGR
20.11%

20.11% a year turned 1,00,000 into 2,50,000 over 5 years. No contributions, so the whole increase is growth and the simple formula is exact. Enter inflation to see the real rate, which is the figure that says whether purchasing power grew. CAGR smooths the path away entirely, so two investments with the same figure can have been very different to hold.

Total return
150%
Total return divided by years
30%
Real CAGR after inflation
20.11%
CAGR on growth alone
20.11%
Total contributed
₹0
Growth, excluding contributions
₹1,50,000
Years to double at this rate
3.78
Money multiplied by
2.5
On contributions
No contributions, so the whole increase is growth and the simple formula is exact.
On inflation
Enter inflation to see the real rate, which is the figure that says whether purchasing power grew.
On the path
CAGR smooths the path away entirely, so two investments with the same figure can have been very different to hold.
How this is calculated

An estimate, not an offer or a guarantee. Projected returns assume the rate you entered holds for the whole term, which no market does.

Method and background

This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for India change on a published schedule; the effective date is shown on every rule-based tool.

How this is calculated

The ratio of ending to starting value, raised to one over the years. That is the constant rate which would have produced the same result, and it is a smoothing: two investments with identical CAGR can differ enormously in volatility. Contributions break the simple formula, because money added in year four did not compound for five years, so the growth component is separated out. Inflation converts the nominal rate into the real one, which is what says whether purchasing power grew.

a root over the period, which smooths the path away entirely
n
Years

Worked examples

Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.

two and a half times over five years

Starting value
₹1,00,000
Ending value
₹2,50,000
Years
5
Added each year
₹0
Inflation over the period
0%
Largest fall along the way
0%

CAGR20.11%

the fifth root of 2.5 less one, against the 30 that division gives

Open this example

contributions inflate the headline rate

Starting value
₹1,00,000
Ending value
₹2,50,000
Years
5
Added each year
₹20,000
Inflation over the period
0%
Largest fall along the way
0%

CAGR20.11%

boundary: only half the increase was growth, the rest was money added

Open this example

Method and limits

What it assumes

  • No withdrawals, and contributions made at the start of each year where entered.

What it deliberately does not model

  • CAGR ignores the path entirely, so it hides volatility and drawdown.
  • With irregular cash flows XIRR is the correct measure rather than this.
  • A CAGR over a short period is dominated by the start and end dates chosen.

Formula version 1.0.0 · definition 1.0.0 · India · Report a problem with this calculator

Frequently asked questions

Why is CAGR lower than total return divided by years?
Because compounding does the work. A 150 percent gain over five years is 20.1 percent a year, and dividing gives 30, which overstates by ten points.
Does CAGR account for money I added?
The simple formula does not, and it overstates when you did. Money added in year four compounded for one year, not five, which is why the growth component is separated here.