Compare growth between two values
on an annual compound basis.

A 50% rise followed by a 50% fall does not restore the starting value

A value of 100 rises 50% to 150 in the first year, then falls 50% to 75 in the second. The arithmetic average of the two annual returns is 0%, yet value has fallen 25%. CAGR measures compound growth from 100 to 75 over two years, about −13.40%.

The arithmetic average adds each annual return and divides by the number of years. CAGR is the constant annual compound rate that reaches the same ending value. This table is arithmetic rather than product performance and excludes taxes, costs and currency changes.

Equal CAGR can hide different intermediate declines

Both 100 → 110 → 121 and 100 → 60 → 121 over two years have a 10% CAGR because their starting and ending values match. The second path, however, experiences a 40% decline from its initial value at the intermediate valuation.

CAGR does not show intermediate volatility or maximum drawdown. When comparing assets with similar growth rates, align the holding periods and separately inspect drawdowns and time to regain prior peaks. A high CAGR does not establish a low-risk holding experience.

Do not mistake added deposits for investment returns

An account funded with 100 receives another 50 during a year with no price change, leaving 150. Entering only 100 and 150 here produces a 50% CAGR, yet the investment gain in this example is zero. Balance growth containing deposits has been mistaken for investment performance.

With intervening cash flows, starting and ending balances alone do not determine investment return. A measure such as XIRR uses cash-flow dates and amounts. This page only measures growth between two values without intervening flows; the monthly-investment backtest separately reports XIRR.

Consistent periods and value definitions make comparisons clearer

A doubling over two years has a CAGR of about 41.42%, while a doubling over five years gives about 14.87%. Equal total growth does not imply equal growth speed. Conversely, equal annualized rates do not remove differences in holding periods or market conditions.

Use the same currency and valuation definition for both amounts. Ending assets including dividends differ from a price excluding dividends, and pre-tax values differ from after-tax values. This calculator does not add currency conversion, dividends or taxes to the inputs. Historical growth is not a promise of future returns.

Explore drawdowns and cash-flow settings · Model an ending value from an assumed return

The CAGR formula

CAGR = [(ending value ÷ starting value)^(1 ÷ years) − 1] × 100. A 100% total gain gives different annual growth rates over different periods.

When you add or withdraw money

Starting and ending balances alone can mistake added contributions for investment gains. Cash flows during the period require a separate measure such as XIRR.

A value doubles over five years

The starting value doubles over five years with no deposits or withdrawals.

Total increase

100.00%

CAGR

14.87%

Growth multiple

2×

Dividing the 100% total gain by five gives 20%, which is not CAGR. About 14.87% annual compound growth produces a doubling over five years.

Frequently asked questions