Investment Guide
CAGR Calculator Guide — Compound Annual Growth Rate Explained India
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Open CAGR Calculator →What is CAGR?
CAGR (Compound Annual Growth Rate) is the rate at which an investment would have grown if it grew at a steady rate annually. It smooths out volatility to give a single comparable growth rate.
CAGR = (Final Value ÷ Initial Value)^(1/Years) − 1
Example: Rs.1 lakh → Rs.2 lakh in 5 years
CAGR = (2,00,000/1,00,000)^(1/5) − 1 = 14.87% p.a.
CAGR of Popular Indian Investments (Historical)
| Investment | 10-Year CAGR | 20-Year CAGR |
|---|---|---|
| Nifty 50 Index | 13-15% | 14-16% |
| Gold (MCX) | 8-10% | 12-14% |
| Real Estate (metro) | 7-10% | 10-12% |
| PPF | 7.1% | ~7.5% historical |
| FD (SBI) | 6-7% | 7-8% historical |
Why CAGR Can Be Misleading
- CAGR assumes steady growth — real investments are volatile
- A fund with 0% one year and 50% next year has 22.5% CAGR — but your experience was very different
- Use CAGR for long-term comparison; look at rolling returns for true picture
- Equity funds: 10+ year CAGR gives most meaningful comparison
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