Stock CAGR Calculator
Compute Compound Annual Growth Rate for your stock investments
Understand the true performance of your stock portfolio by calculating the compound annual growth rate (CAGR) - the rate at which your investment would have grown if it had grown at a steady rate.
Calculate Stock CAGR
Amount invested initially
Current or expected final value
Duration of investment
💡 Tip: CAGR smooths out volatility to give you a clear picture of your investment's annual performance over time.
Understanding CAGR
What is CAGR?
- Measures the mean annual growth rate over time
- Smooths out short-term volatility and fluctuations
- Perfect for comparing different investment options
- Assumes compounding effect on returns
Why Use CAGR?
- Get a clear picture of investment performance
- Compare returns across different time periods
- Evaluate fund manager or stock performance
- Make informed investment decisions
The CAGR Formula
CAGR is calculated using the following mathematical formula:
CAGR = [(Ending Value / Beginning Value)^(1/n)] - 1 - Ending Value: Final value of investment
- Beginning Value: Initial investment amount
- n: Number of years
The result is typically expressed as a percentage representing the average annual return.
Important Considerations
- • Past performance doesn't guarantee future results - CAGR is based on historical data
- • Doesn't account for volatility - Two investments with same CAGR can have different risk profiles
- • Best for long-term investments - More meaningful when calculated over 3+ years
- • Assumes reinvestment - Calculation assumes all gains are reinvested
Smart Stock Investment Tips
Diversify Portfolio
Spread investments across different sectors and asset classes to minimize risk.
Long-Term Focus
Stay invested for the long haul to benefit from compounding and ride out market volatility.
Research & Due Diligence
Thoroughly analyze companies before investing. Understand their business model and financials.