Find the compound annual growth rate (CAGR) between a starting and ending value over a number of years. Enter all three.
Usage Tip
CAGR lets you compare growth over different time spans on an equal, per-year footing.
The steady yearly rate matching the total change
It smooths out the ups and downs into one representative yearly figure.
CAGR assumes steady compounding, not the actual year-by-year path.
This is a descriptive growth metric, not investment advice.
Compound annual growth rate is the steady yearly rate that would take a starting value to an ending value over a set number of years. It is calculated as the ending value divided by the beginning value, raised to the power of one over the number of years, minus one.
CAGR smooths out the ups and downs of a real investment or business metric into a single number, which makes different options easy to compare over the same period. It does not describe the path taken, so two investments with the same CAGR can have very different volatility. It also requires a positive starting value and is not a forecast of future growth.