# CAGR Calculator

- **URL:** https://codeasystem.com/calculators/finance/cagr-calculator/
- **Category:** finance
- **Description:** Find the compound annual growth rate between two values over any number of years.
- **Primary output:** Compound annual growth rate: 15.02%

## Inputs
- Beginning value (name: `begin`, type: number, prefix: $, example: 8000)
- Ending value (name: `end`, type: number, prefix: $, example: 14000)
- Number of years (name: `years`, type: number, example: 4)

## Outputs
- Compound annual growth rate: 15.02%
- Total growth: 75%
- Value after 10 more years: $56,718.29

## Formula / methodology
```
CAGR = (End / Begin)^(1/years) − 1
```

CAGR answers: “what steady yearly rate would carry the beginning value to the ending value?” It smooths volatile journeys into one comparable figure; a portfolio that swung +40%, −20%, +15% still has a single CAGR over the span.

## Assumptions & limitations
- Growth is measured between two points in time only.
- Intermediate volatility is deliberately hidden.
- No cash flows in or out during the period.

## Example
Growing from $8,000 to $14,000 over four years is a 75% total gain; a CAGR of 15.02% per year.

Result for these inputs:

```
Compound annual growth rate: 15.02%
```

## About this calculator
### Why analysts live in CAGR

Revenue comparisons, fund marketing and business cases all quote CAGR because it removes calendar distortion: “we grew 300% in six years” sounds heroic until CAGR reveals it as ~26%/year against competitors doing 35%.

### What CAGR conceals

Two investments with the same endpoints can have radically different risk. CAGR says nothing about drawdowns along the way; pair it with volatility measures before judging quality.

## FAQs
### Can CAGR be negative?

Yes. If the ending value is below the beginning, CAGR is negative and represents the steady yearly loss.

### How is CAGR different from average return?

Arithmetic averages ignore sequencing; CAGR reflects actual compounding. A −50% year followed by +50% averages to 0% arithmetically but loses 25% in reality; which CAGR captures.

### Can I use it for shrinking metrics like churn?

It computes fine for any positive values; a negative CAGR on costs is good news.

## Related calculators
- [ROI Calculator](https://codeasystem.com/calculators/finance/roi-calculator/)
- [Rule of 72 Calculator](https://codeasystem.com/calculators/finance/rule-of-72-calculator/)
- [Compound Interest Calculator](https://codeasystem.com/calculators/finance/compound-interest-calculator/)

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Last updated: 2026-08-23 · Version: 1.0.0 · [HTML version](https://codeasystem.com/calculators/finance/cagr-calculator/)