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Compound annual growth rate between two values.
Free to use, no sign-up required. CAGR Calculator is one of 198 tools built into Xenition, alongside a chat that can use them for you.
Finds the compound annual growth rate: the steady yearly rate that turns a start value into an end value over a number of years. It is used to compare investments or business growth over different periods.
CAGR = (end ÷ start)^(1 ÷ years) − 1, shown as a percentage. Total return = end ÷ start − 1. The start value and years must be above zero.
10,000 growing to 18,000 over 5 years is a total return of 80%. The CAGR is 1.8^(1/5) − 1 = 12.47% a year.
Dividing 80% by 5 gives 16%, but that ignores compounding. Each year’s growth builds on the previous year’s gains, so a lower steady rate of 12.47% reaches the same end value.
No. It only uses the first and last values, so a smooth climb and a sharp crash followed by a recovery can have the same CAGR. It also ignores money added or withdrawn along the way.
You do not have to open CAGR Calculator to use it. Ask Xenition in plain language and it runs the right tool, then carries the answer into whatever you are working on — a document, a spreadsheet, a deck.