CAGR
Compound Annual Growth Rate
Investment PlanningThe mean annual growth rate of an investment over a specified period longer than one year, assuming profits are reinvested at the end of each year.
Formula
CAGR = [(Ending Value / Beginning Value)^(1/n) - 1] × 100
Why it matters
CAGR smooths out volatility to show the 'true' annual return. It's the standard way to compare investments over different time periods.
Indian example
Related terms
Learn the concept
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