CAGR Calculator
Find the compound annual growth rate (CAGR) between a start value and an end value, with a year-by-year path.
Results
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Year by year at this rate
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Quick Answer
CAGR = (end value ÷ start value) ^ (1 ÷ years) − 1. If $10,000 grows to $20,000 in 5 years, the CAGR is about 14.87% a year. That is the steady yearly rate that would double the money in 5 years.
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Table of Contents
How This CAGR Calculator Works
CAGR turns growth over several years into one steady yearly rate. It is used for investments, company revenue, prices and more. Enter a start value, an end value and the number of years.
Quick explanation: CAGR is the yearly rate that turns the start value into the end value, with compounding.
- Years: part years such as 2.5 are fine.
- Falling values: give a negative CAGR.
- Path: shows each year at the steady rate.
Core Formulas
- CAGR: (end ÷ start) ^ (1 ÷ years) − 1
- Value after n years: start × (1 + CAGR) ^ n
- Total change: (end ÷ start − 1) × 100
Worked Example
A company's revenue falls from $2.5 million to $1.8 million over 4 years.
- End ÷ start = 1.8 ÷ 2.5 = 0.72
- 0.72 ^ (1 ÷ 4) = 0.9212
- CAGR = -7.88% a year
CAGR, ROI and Average Return
- ROI: total gain over the whole period, not per year.
- Average return: a simple average of yearly returns can overstate growth.
- CAGR: the compounded yearly rate, best for comparing over time.
- Deposits: CAGR ignores money added or taken out along the way.
Frequently Asked Questions
Divide the end value by the start value, raise it to the power of 1 divided by the years, then subtract 1.
It depends on what you measure. Compare it with similar investments or companies over the same years.
Yes. If the end value is lower than the start value, the CAGR is negative.
ROI is the total return. CAGR is the steady yearly rate that gives the same result.
No. It only uses the start and end values.
References & Sources
| Source | Used For | Link |
|---|---|---|
| Investopedia, Compound Annual Growth Rate (CAGR) | CAGR definition and use. | https://www.investopedia.com/terms/c/cagr.asp |
| Wikipedia, Compound annual growth rate | The CAGR formula. | https://en.wikipedia.org/wiki/Compound_annual_growth_rate |