Find the compound annual growth rate (CAGR) from an initial and final value over a number of years.
How investment return is worked out
CAGR is the smooth annual rate that would take your initial value to your final value over the holding period. Enter the start value, end value and years to see it, plus the total return and gain.
It’s the fairest single number for comparing investments held for different lengths of time.
Try it with these numbers
Take the starting scenario, a years held of 6. That gives a annual return (CAGR) of 10.29%. Underneath, Total return comes out at 80% and Total gain at $8,000. Change any field and every figure updates as you type.
How to fill it in
- Enter the initial value.
- Enter the final value.
- Enter the years held to get the CAGR.
How the number is calculated
CAGR = (final ÷ initial)^(1 ÷ years) − 1
Questions people ask about this
What is CAGR?
The compound annual growth rate — the constant yearly rate that links the start and end values over the period.
How is it different from total return?
Total return is the whole gain as a percentage; CAGR expresses it as a yearly rate, so it’s comparable across time frames.
Does CAGR show volatility?
No — it smooths the path. Two investments with the same CAGR can have very different ups and downs. This isn’t advice.