💰 Financial
CAGR Calculator
Calculate the Compound Annual Growth Rate (CAGR) of an investment. Input the initial value, final value, and number of years to determine the smoothed annualized yield.
⏳
Formula
CAGR = (FV / PV)^(1 / t) - 1CAGR- Compound Annual Growth Rate
FV- Final Value of investment
PV- Initial Value (Present Value) of investment
t- Time period in years
Example
5-Year Investment Growth
An investment grows from $1,000 to $2,000 over 5 years.
- PV = 1,000, FV = 2,000, t = 5
- CAGR = (2000 / 1000)^(1 / 5) - 1
- CAGR = (2)^(0.2) - 1
- CAGR = 1.14869 - 1 = 0.14869
- CAGR = 14.87%
Frequently Asked Questions
CAGR represents the smoothed, annualized rate of return of an investment, assuming it grew at a steady rate each year.