Calculate Compound Annual Growth Rate (CAGR) online for mutual funds, stocks, real estate & gold. Includes inflation-adjusted real returns, LTCG tax impact, Rule of 72 doubling time, and PDF report export.
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How to Use CAGR Calculator
Select your calculation mode: Point-to-Point CAGR, Future Value Projector, Reverse Goal Rate, Multi-Year Series, or Asset Benchmarks.
Enter your Initial Investment and Final Portfolio Valuation.
Set the duration using Years & Months sliders or choose Exact Calendar Dates.
Optionally toggle Advanced Settings to adjust inflation rates and apply Indian Budget 2024 LTCG tax rules.
View instant CAGR (%), Real CAGR, wealth multiplier (x), doubling time, year-by-year compounding trajectory, and download a professional PDF report.
Understanding Compound Annual Growth Rate (CAGR)
CAGR is the industry standard metric used by fund managers, financial advisors, and wealth analysts to evaluate the annualized performance of investments. Unlike absolute returns, which ignore the dimension of time, CAGR provides a smoothed, normalized annual percentage that enables fair side-by-side comparisons across different asset classes (e.g. comparing a 3-year mutual fund return against a 7-year real estate investment).
CAGR Formula and Compounding Mechanics
The mathematical formulation for CAGR is:\n\n**CAGR = [ ( Ending Value / Beginning Value )^(1 / t) ] − 1**\n\nWhere:\n- **Ending Value (V_final)**: The current market valuation or final redemption proceeds\n- **Beginning Value (V_initial)**: The original principal capital invested\n- **t**: Total duration in years (computed as fractional years, e.g., 4.25 years or exact day count / 365.25)\n\nBecause compounding operates geometrically rather than linearly, CAGR accounts for interest-on-interest accumulation, making it superior to simple arithmetic averages.
To assess true real-world wealth accumulation, CAGR must be evaluated alongside:\n\n1. **Real Inflation-Adjusted Return**: High nominal returns can be eroded by inflation. If your portfolio generates 12% CAGR while CPI inflation runs at 6%, your real purchasing power expands at 5.66% p.a.\n2. **Post-Tax In-Hand Returns**: Under Indian tax laws (Budget 2024), Equity LTCG is taxed at 12.5% on gains exceeding ₹1.25 Lakh per financial year, whereas Debt/FD returns are taxed at marginal income tax slabs.\n3. **Rule of 72 & 114**: Dividing 72 by your CAGR gives the approximate number of years required to double your capital (e.g., 12% CAGR doubles wealth in ~6 years; 15% CAGR doubles wealth in ~4.8 years).
Frequently Asked Questions
What is CAGR?
CAGR stands for Compound Annual Growth Rate. It represents the constant geometric rate at which an investment would have grown if it had compounded smoothly year after year over a multi-year horizon.
What is the formula used for CAGR?
The formula is: CAGR = ((Ending Value / Beginning Value) ^ (1 / t)) - 1, where t is the total elapsed duration in years.
How is Real CAGR calculated against inflation?
Real CAGR is computed using the Fisher equation: Real CAGR = ((1 + Nominal CAGR) / (1 + Inflation Rate)) - 1, showing the true expansion of your purchasing power.