Return on investment
Calculate the total return on an investment, including additional costs and income received.
Saving & investingSaving & investing
Annualized growth (CAGR) calculator
One rate to explain the whole ride.
Your numbers
Turn a start and end value into a smoothed annual growth rate.
TRY AN EXAMPLE
Your answer is just a moment away.
Enable JavaScript to calculate. The formulas and examples below work without it.
Saved scenarios stay in this browser. No account, no upload.
THE MATH, WITHOUT THE MYSTERY
What’s actually happening here?
CAGR is the constant annual rate that would connect a starting value to an ending value. It smooths the journey; it does not describe every bump along the way.
It works best when there are no external deposits or withdrawals between the two values. Contributions can make a portfolio grow even when the underlying investments do not, which would make a simple CAGR misleading.
THE FORMULA
CAGR = ((Ending value / Starting value)^(1 / years) − 1) × 100
A small example
Growing from 1,000 to 1,210 in 2 years gives (1,210 ÷ 1,000)^(1/2) − 1 = 10% per year.
GOOD QUESTIONS
A few things worth knowing.
Is CAGR the average of yearly returns?
No. It is a geometric growth rate. An arithmetic average does not account for the way returns compound.
What if my ending value is zero?
The formula returns −100%. A smooth intermediate path is not meaningful in that case, so the tool shows only the start and end.