▸CAGR is 12.47% per year.
- Over 5 years, the investment grew from 10,000 to 18,000, a total gain of 80.0%.
- At 12.47% CAGR, the value doubles roughly every 5.8 years (Rule of 72).
- A CAGR of 10-20% is strong by historical standards. The S&P 500 has averaged roughly 10-11% annually over the long run.
- CAGR smooths out year-to-year volatility: it shows the steady rate that would produce the same end result, not what actually happened each year.
Next stepTo compare two investments on equal footing, put both into the calculator and compare their CAGRs over the same horizon. A longer time period often reveals which choice truly compounds best.