CAGR Calculator : Calculate the Compound Annual Growth Rate (CAGR) of Investment
September 18, 2024
CAGR Calculator : A CAGR Calculator helps you calculate the Compound Annual Growth Rate (CAGR) of an investment over time.
This shows how much an investment has grown on average per year.
It’s a useful tool to understand how investments, like stocks or mutual funds, perform over a period.
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CAGR Calculator
How to Use the CAGR Calculator?
Using a CAGR calculator is very simple. You just need to provide three main inputs:
- Beginning Value: This is the value of your investment when you started.
- Ending Value: This is the value of your investment after a certain period.
- Number of Years: This is how long you held the investment (in years).
Once you have entered these details, the calculator will provide you with the CAGR percentage.
This number tells you how much the investment has grown each year.
Why Use a CAGR Calculator?
A CAGR calculator is a great tool because it makes investment comparisons easy.
Whether you are looking at stock performance or comparing mutual funds, it provides a clear picture of growth.
For example, if you invested ₹10,000 in 2015 and it grew to ₹20,000 in 2020, the CAGR calculator will show you how much your investment grew each year on average.
This is helpful for making future investment decisions.
Benefits of Using the CAGR Calculator
- Simple to Use: You only need three values: beginning value, ending value, and the number of years.
- Accurate Growth Insight: It shows a consistent yearly growth rate, making comparisons easier.
- Better Financial Planning: Knowing the CAGR helps you understand the performance of your investments and plan your future financial goals.
Conclusion
The CAGR Calculator is an essential tool for investors who want to know how their investments are performing.
It gives you a clear, easy-to-understand percentage that tells you the average growth per year. This can help in making smarter investment decisions in the future.
FAQS
Why is CAGR important?
CAGR gives a clear picture of the average yearly growth of an investment. It helps investors compare different investments, even if they grew at different rates each year.
What is a good CAGR?
A good CAGR depends on the type of investment and market conditions. For example, a CAGR of 8-12% is generally considered good for stock market investments.