What this calculation tells you
CAGR is the annual rate that would turn a starting value into an ending value if growth were perfectly smooth. It summarises the start and finish, but it does not show the journey or the size of temporary losses.
Use it when there is one starting investment and one ending valuation with no cash flows in between. Additional deposits or withdrawals make a simple endpoint calculation misleading; those situations need a cash-flow-aware method such as XIRR.
The method, explained
CAGR = [(ending value ÷ starting value)^(1 ÷ years) − 1] × 100
The inputs use the units printed beside each field. Values shown in result cards are rounded for readability; the calculator keeps more precision while applying the formula.
A worked example
Starting value: ₹1,00,000.00 · Ending value: ₹1,80,000.00 · Elapsed time: 5 years.
Compound annual growth rate: 12.47%
This example uses the inputs above. Your result changes when you change them.
Assumptions & limitations
- The starting value must be positive and the ending value non-negative.
- There are no intermediate contributions or withdrawals.
- CAGR does not measure risk or predict the next year’s return.
Questions about this tool
Is CAGR the same as an arithmetic average?
No. CAGR links the endpoints through compounding. Adding yearly returns and dividing by the number of years is a different calculation.
What if the ending value is zero?
The model reports −100% CAGR. The investment has lost all of its endpoint value.
Published by Sanu Tech Innovation LLP · Model notes updated 30 September 2026. Read our calculation standards or report a reproducible issue.