CAGR tells you the smooth annual rate at which an investment needed to grow — cutting through year-to-year volatility to give you a single comparable number.
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CAGR = (FV/PV)1/n − 1. It answers: "if this investment grew smoothly every year, what was the annual rate?" Useful for comparing investments across different time horizons.
Past CAGR does not predict future returns. See our full disclaimer.