CAGR Calculator

The Compound Annual Growth Rate (CAGR) calculator determines the smoothed annualized return of an investment over a specific time period. Unlike standard average returns which can be skewed by volatility, CAGR provides a steady growth rate metric, making it the gold standard for comparing the performance of mutual funds, stocks, and business revenues. Investors analyzing a mutual fund's prospectus can cut through marketing noise by calculating the true annualized growth over a five-year period. It is highly recommended to compare the CAGR of your chosen asset against a baseline index, like the S&P 500, to determine if you are actually outperforming the market. This gives you a standardized metric that smooths out extreme volatility in any single year.