##### Definition:

Compound annual growth rate (CAGR) measures the rate of return for an investment such as a mutual fund or bond over a specific period of time. It is a useful measure for the growth of your investment.

#### Formula:

CAGR = (Endinging value/Beginning value) ^{1/Number of Periods} - 1
**Where,**
CAGR - Compound Annual Growth Rate
##### Example:

Hiox invested $15,000 in a portfolio on Nov 17, 2004. Let's say by Nov 17, 2006, the company’s portfolio had grown to $16,000, by 2007 the profit is $17,000 , and finally ended up at $6,50,000 by 2013

##### Given,

Beginning value = $15,000
Ending value = $6,50,000

##### Solution:

Substitute the values in the formula,

CAGR | = (Endinging value/Beginning value) ^{1/Number of Periods} - 1 |

| = (650000 / 15000)^{1/9} - 1 |

| = 0.52009 |

| = 0.52009 * 100 |

| = 52.009 % |