Overview

Compound annual growth rate (CAGR) measures a company's or an investment's annual growth rate over a time horizon, taken into account the effecting compounding. CAGR is a useful metric to compare past vs current performance, or between different investments over the similar investment period. The formula for calculating CAGR is as follows:

CAGR = (Ending Value / Beginning Value) ^ (1 / # of Compounding Periods) - 1

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