💸 CAGR Calculator for Indian Investors

🧠 What is CAGR?

CAGR (Compound Annual Growth Rate) is the rate at which an investment grows every year, on average, over a specific period of time. It smooths out the returns so that the investment growth appears steady, even if it fluctuated year-to-year.

CAGR helps you compare different investments over time in a fair and consistent way.

📐 CAGR Formula

The formula to calculate CAGR is:

Or in percentage:

📝 Why is CAGR Important?

• It removes volatility and shows a smoothed-out growth rate

• Helps you compare returns of different assets (stocks, SIPs, mutual funds)

• Useful in financial planning and long-term investment decisions

Where:

• FV = Final Value

• PV = Present Value (Initial Investment)

• T = Time period in years

📊 CAGR Example

Let’s say you invested ₹1,00,000 in a mutual fund, and after 5 years, your investment grows to ₹2,00,000.

Using the formula:

CAGR = [(Final Value / Initial Investment) ^ (1 / Number of Years)] - 1

CAGR (%) = { [(FV / PV) ^ (1 / T)] - 1 } × 100

CAGR = [(200000 / 100000) ^ (1 / 5)] - 1
= (2 ^ 0.2) - 1
≈ 0.1487 or 14.87%