Is CAGR the actual return in every year?
No. It is a smoothed annual equivalent; the real sequence can be uneven or include losses.
CAGR Calculator
Find the smoothed annual growth rate between two positive values.
Try the calculator
Adjust the values below to get a clear estimate.
Annualized compound rate
The ending-to-starting ratio is raised to the reciprocal of elapsed years, then one is subtracted. This equivalent constant rate hides year-to-year variation.
CAGR = (ending / starting)^(1 / years) − 1Worked example
Growth across four years
Inputs: startingValue: 10,000 · endingValue: 15,000 · years: 4
Illustrative result: About 10.67% per year
A constant annual rate of approximately 10.67% would connect the two values over four years, though actual returns may vary.
Related tools
Good to know
Frequently asked questions
Can an ending value be zero?
No. The standard compound annual growth formula requires positive beginning and ending values.