When investing or saving (Yes, they
are different), it is often useful to calculate your returns to measure
how your investments (or savings) are doing. This can be easily done by
calculating CAGR or the Compound Annual Growth Rate (CAGR) of your investments.
A simple formula for calculating CAGR is,
We have created a simple CAGR Calculator, which you can use to calculate real returns for your investments. To download this calculator, click on this link. You will be taken to a Google Spreadsheet. Go to the File Menu, and click Download. Once the spreadsheet is downloaded, you can fill up the required numbers and the CAGR or Final Amount or Years will be calculated accordingly.
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| Always calculate the real growth rate of your investments |
What is CAGR
“CAGR isn't the actual return in reality. It's an imaginary number that describes the rate at which an investment would have grown if it grew at a steady rate. You can think of CAGR as a way to smooth out the returns.”
Formula for calculating CAGR
A simple formula for calculating CAGR is,
A simple tool to help you calculate CAGR
We have created a simple CAGR Calculator, which you can use to calculate real returns for your investments. To download this calculator, click on this link. You will be taken to a Google Spreadsheet. Go to the File Menu, and click Download. Once the spreadsheet is downloaded, you can fill up the required numbers and the CAGR or Final Amount or Years will be calculated accordingly.
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| Click on image to go to the CAGR Tool |
In case you have any problems downloading the calculator, just leave a comment below (with email) and we will mail it to you. The instructions for using the calculator are given in the
sheet itself.
Hope you find it useful.
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just a quick question..where do you find the P/BV ratio of a particular script...tried googling but no luck. Keep up the good work..I like reading your site..
ReplyDelete@8eed52d84c1c844aa6be255d2db4222a:disqus
ReplyDeleteBook Value per share can be found from company's quarterly/annual reports. This BV can then be used for calculating P/BV on a daily basis.
Thanks,
ReplyDeleteNo. of years corresponds to the period over which the data has been taken or the actual no. of years?? For eg if we are taking 2003-08...no. of years will be 5 or 6??
ReplyDelete@facebook-544549790:disqus
ReplyDeleteIn the case of 2003-08, no. of years would be 5 (Assuming the exact period to be January 1, 2003 to December 31, 2008)
If u assume Jan1 2003 to 31st Dec 2008... it should come out to 6 years..isn't it?
ReplyDeleteWe take the periods...as in 2003-04 is 1....2004-05 is 2 and so on...
ReplyDelete@facebook-544549790:disqus @facebook-100000415251727:disqus
ReplyDeleteWe found a helpful video on the topic. Hope you find it useful too :-)
http://youtu.be/EMhrRmse-r4
Hey!
ReplyDeleteCan you also provide a CAGR formula for monthly payments which culminate into a bulk yield at the end of x years.
E.g.: If I pay 3k per month for 15 years and the maturity value is 15 lacs, what is the effective CAGR of this investment?
@b4782d5c5a743d32ab4839b96422cbd3:disqus
ReplyDeleteYou can calculate the effective CAGR of your investments using XIRR function in MS Excel.