CAGR Calculator

CAGR (Compound Annual Growth Rate) measures the mean annual growth rate of an investment over a specified time period. Formula: CAGR = (Final Value / Initial Value)^(1/n) − 1, where n is the number of years. It smooths out year-to-year volatility to give a single meaningful growth rate.

Benchmarks: Nifty 50 has delivered ~12–14% CAGR over 20 years. Top mutual funds: 15–20% over 10 years. Real estate in metros: 6–9%. Fixed deposits: 6–7.5%. PPF: 7–8%. A CAGR of 12%+ is generally considered good for equity investments. Inflation runs at ~5–6%, so any investment below that loses purchasing power.

CAGR works when there's a single investment and a single maturity value — no intermediate cash flows. XIRR is for investments with multiple irregular cash flows (like SIPs, which have monthly investments). For evaluating mutual fund SIP returns, always use XIRR, not CAGR. For evaluating a lump sum stock purchase, CAGR is appropriate.

Yes. If your final value is less than your initial value, CAGR will be negative. For example, investing ₹1L that became ₹70,000 over 5 years gives a CAGR of −6.9%. Negative CAGR indicates wealth erosion. This commonly happens with poor stock picks, NFO duds, or panic-sold equity investments.

The Rule of 72 estimates how many years to double money: divide 72 by the CAGR. At 12% CAGR, money doubles in ~6 years (72/12). At 8%, it takes 9 years. It's a quick mental shortcut. The actual formula is ln(2)/ln(1+r), but 72/r is accurate enough for practical use.