Average Rate of Return Calculator
See how your investment grew over time. Calculate your compound annual growth rate (CAGR), compare it with a simple average, and adjust for inflation.
Free to use · No signup · Two calculation methods
Choose what you know
Enter the start and end values
Use the same currency for both amounts.
Enter each annual return
One percentage for each consecutive year, in order.
Annualized return (CAGR)
10,000 growing to 21,000 over 5 years is equivalent to roughly 16.00% compounded annually.
A simple annual average needs the individual yearly returns.
Want a purchasing-power comparison? Add an inflation assumption.
See the calculation breakdown
| Year | Annual return | Value index |
|---|
This is a historical calculation, not a prediction of future returns.
Two averages. Different questions.
Use CAGR to describe the compounded growth over the period. Use the arithmetic average to summarize the individual annual percentages.
Compound annual growth rate
CAGR is the steady annual rate that connects an investment’s starting value to its ending value. It captures compounding, but it does not show the gains and losses along the way.
For annual returns, multiply the yearly growth factors, take the nth root, then subtract one. A 10% return has a growth factor of 1.10.
Arithmetic average return
Add the individual yearly percentage returns and divide by the number of years. This gives each year equal weight. It does not describe the actual compounded growth of your money.
You cannot recover this average from only a starting value, ending value and timeframe. Different yearly paths can have the same ending value.
A 50% gain followed by a 50% loss
Starting at 100, the value rises to 150, then falls to 75. The simple average return is 0%, but the total return is −25% and the annualized compounded return is approximately −13.40%. The same percentage gain and loss do not cancel out.
Turn a return into a savings plan
Your monthly contribution matters too. See what it would take to reach your first 100k, then track your actual progress.
A few things to know
Which calculation method should I choose?
Choose start and end values when you know those balances and did not add or withdraw money during the period. Choose yearly returns when you have a return percentage for each consecutive full year. The yearly method shows both geometric and arithmetic averages.
What if I made deposits or withdrawals?
Deposits raise your balance without being investment gains, and withdrawals lower it without necessarily being losses. This calculator does not account for those cash flows. To measure your personal account performance, use a money-weighted calculation such as IRR or XIRR that includes the amounts and dates, or check the methodology on your broker’s performance report. CIRO explains the difference between money-weighted and time-weighted returns.
Does this include dividends, taxes and fees?
Only if your inputs already reflect them. For total investment performance, use values or annual returns that include reinvested income. Cash dividends paid outside the investment are not captured by a price-only ending value. Fees and taxes can reduce the amount you keep; this tool does not estimate them separately. Compare returns on the same basis.
How does the inflation adjustment work?
The real annual return is (1 + nominal CAGR) ÷ (1 + inflation rate) − 1. Enter inflation as an annual percentage. This optional result uses a constant assumption to compare purchasing power. Leaving inflation blank omits that comparison; entering 0% means you explicitly assumed no inflation.
Can I use monthly returns or different currencies?
Enter only full-year returns in the yearly list; twelve monthly entries would be treated as twelve years. In the values method, express the elapsed period in years, so six months is 0.5. Any currency works if you use the same currency for both balances. The calculator does not convert currencies or isolate foreign-exchange gains.
Is a higher CAGR always a better investment?
Compare the same timeframe, fees and currency, then consider risk and the size of losses along the way. CAGR smooths the result and cannot tell you how volatile the investment was. A short period can produce a large annualized rate that should not be treated as a forecast.
Are my figures saved?
This calculator processes figures in your browser and does not save them in a calculator account or send them to a calculation server. Reloading resets the examples. The website’s usual analytics and advertising still apply. See the privacy policy for site-wide information.