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CAGR Calculator

₹5000
₹25000
5 Yr
CAGR is 37.97%

How can a CAGR Calculator Help You?

If you own a business, the CAGR can indicate a lot of factors that are otherwise overlooked. Unlike the concept of 'absolute returns', growth based on CAGR takes into account the element of time. It is thus a better indicator of growth over a period.

Note that the CAGR is an indicative figure and not a real one. In its most basic sense, it indicates the exact rate of an investment's growth considering that it grows at the same rate and the returns are reinvested. Taking note of CAGR is also a huge bonus when you are considering differential investment options.

A CAGR calculator helps you determine the true returns on investment yearly. In this sense, using our CAGR calculator online saves you time and other resources as it is completely free.

Thus, the CAGR calculator can tell you if:

  • Your business is growing with time and whether the profits thus generated is being invested correctly.
  • It will enable you to evaluate your investment options. For example, if stock A is not working as well as Stock B based on their respective CAGR indices, you can invest in Stock B instead.
  • The relative growth of your organization with respect to the market leaders in your business segment.

Note that no CAGR calculator in India will give you any data on investment risk.

How to Calculate CAGR?

The CAGR formula to calculate the investments is represented by:

CAGR = (FV / PV) 1 / n – 1

It is a mathematical calculation that determines the real-time CAGR for any organization. The values stand for the following:

  • Future Value
  • Present Value
  • Time period in years

An example of CAGR calculation

If you have an initial investment of Rs. 1 Lakh in a business, it constitutes the PV. If the total investment has swollen to Rs 10 Lakh (FV) after 5 years (N), the CAGR is:

(10,00,000/1,00,000)1 / 5 – 1 or 0.589

Thus, the CAGR percentage is CAGR x 100 or 58.9%.

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