A Compound Annual Growth Rate is the approximated rate of the return that would be required to measure your growth from initial balance to final balance within the particular lifespan.
CAGR is counted with an assumption that earned interest is reinvested at the end of each year of its period. People should be aware that the compound annual growth rate is not the actual rate of return.
The Formula for calculating Compound Annual Growth Rate (CAGR) is as follows:
CAGR = (FV / IV)(1 / t) - 1
- CAGR - Compound Annual Growth Rate
- FV - future value or also referred as final value
- IV - Initial value or present value
- t - Tenure or term
What can you do with CAGR Calculator?
- It helps to calculate approximated CAGR rate for your future earning investments.
- Users can see the accurate compound annual growth rate.
- The chart represents the growth of the total amount and initial amount by the scale of two years.
- Users can easily see their calculations in detail by the table. Based on the selected compound frequency table describes the opening balance, your earned interest, closing balance and period.
- This calculator helps to share your calculations by URL.