Investing & funds
What is CAGR?
Also called: Compound annual growth rate
Hinglish mein padhein: CAGR kya hota hai?
CAGR is the constant yearly growth rate that takes an investment from its start value to its end value over a period.
CAGR = (end value ÷ start value)^(1 ÷ years) − 1. It smooths out the ups and downs along the way.
Use XIRR instead when money went in or out at different times, as with SIPs.
Example
₹1 lakh growing to ₹2 lakh in 6 years is a CAGR of about 12.2%.