CAGR stands for Compound Annual Growth Rate. It represents the mean annual growth rate of an investment over a specified period of time longer than one year, assuming the investment compounds steadily.

What is the formula used for CAGR?

The formula is: CAGR = ((Ending Value / Beginning Value) ^ (1 / t)) - 1, where t is the total duration in years.

Why is CAGR preferred over absolute returns?

Absolute return only shows the total growth percentage without considering time. CAGR factors in the time value of money, letting you compare the performance of different asset classes over identical periods.

CAGR Calculator

Calculate Compound Annual Growth Rate (CAGR) online. Enter initial and final values along with the time period to get accurate annual compounding return percentages.

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