How is CAGR different from average return?

Average return is a simple arithmetic mean. CAGR is the geometric mean, which correctly accounts for compounding.

Can CAGR be negative?

Yes. If the ending value is less than the beginning value, CAGR is negative.

When should I use XIRR instead?

Use XIRR when there are multiple cash flows on different dates. CAGR only works for one investment and one withdrawal.

CAGR Calculator

Calculate the Compound Annual Growth Rate between a beginning and ending value.

Inputs

Beginning value

INR

Ending value

INR

Number of years

yrs

Currency

Result

CAGR

14.87%

Over 5 years

Absolute Return100%

Absolute Gain₹100,000.00

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Formula

CAGR = (End / Begin)^(1 / years) − 1, expressed as a percentage.

How it works

CAGR (Compound Annual Growth Rate) is the smoothed annual rate at which an investment would have grown if it compounded at the same rate every year.

Example

Example: ₹1,00,000 grows to ₹2,00,000 over 5 years → CAGR ≈ 14.87%.

Frequently Asked Questions

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Disclaimer: Results are estimates for informational purposes only and should not be considered financial, medical, legal, or professional advice. Always consult a qualified professional before making decisions.