CAGR Calculator India – Calculate Compound Annual Growth Rate

Calculate the compounded annual growth rate of your investments over time. Ideal for measuring the performance of stocks, mutual funds, or business revenue growth with precision.

Growth Parameters

Yr

Absolute Profit

₹0

Total Growth %

0%

Investment Performance Result

Compound Annual Growth Rate (CAGR)

0%
Initial Principal Growth Earned
₹0
₹0

Key Insights

  • ✅ Smoothes out annual volatility
  • 📈 Precise geometric progression
  • 🔄 Comparative tool for assets
  • ⚡ Simple periodic analysis

How is CAGR Calculated?

CAGR = [(Final Value / Initial Investment)1/n - 1] × 100

Final Value: Current value of the investment

Initial Investment: Beginning value of the investment

n: Number of years (Investment Period)

What is CAGR?

Compound Annual Growth Rate (CAGR) is the rate of return that would be required for an investment to grow from its beginning balance to its ending balance, assuming the profits were reinvested at the end of each year of the investment's lifespan.

Unlike absolute returns, CAGR accounts for the time value of money and provides a smoothed annual rate. This is particularly useful in India for comparing the performance of a volatile asset like a mutual fund investment against a steady asset like a Fixed Deposit (FD). Furthermore, CAGR can help you compare these potential investment returns against the cost of borrowing as calculated by an EMI calculator.

Practical Example:

If you invest ₹1,00,000 in a stock and it grows to ₹2,00,000 over 5 years:

  • Absolute Return: 100%
  • Average Annual Return: 20% (Simple division)
  • CAGR: ~14.87% (Actual annual growth with compounding)

Compound Annual Growth Rate (CAGR) FAQ

What is CAGR in investments?
CAGR is the most accurate way to measure the annual growth of an investment over time. It assumes the investment grows at a steady rate and profits are reinvested, allowing for an "apples-to-apples" comparison between different investment options.
What is the difference between CAGR and XIRR?
CAGR is used for point-to-point investments (one-time buy and one-time sell). XIRR (Extended Internal Rate of Return) is used for multiple cash flows at different intervals, such as SIPs or irregular investment top-ups and withdrawals.
Can CAGR be negative?
Yes, if the final value of your investment is lower than the initial amount, the CAGR will be negative. This represents the average annual percentage loss you sustained during that period.
Is CAGR reliable for short-term investments?
CAGR is most reliable for periods longer than one year. For periods less than a year, absolute returns or annualized returns are typically used, as CAGR's assumption of annual compounding may misrepresent short-term volatility.
Does CAGR account for inflation?
No, CAGR provides the "Nominal" rate of return. To understand the "Real" growth of your wealth, you must subtract the average annual inflation rate from your CAGR results.
What is a good CAGR for mutual funds in India?
For long-term equity mutual fund investments in India, a CAGR of 12-15% is generally considered very good, as it outperforms traditional savings like Fixed Deposits and stays well above the long-term inflation rate (usually 5-6%).