📈 Meaning:
CAGR tells you the average annual growth rate of an investment over a period of time as if it grew at a steady rate every year, even though actual yearly returns may vary.
🧮 Formula:
CAGR = ( Ending Value\Beginning Value)^{1/n} - 1
where n = number of years
💡 Why it matters:
- Smooths out volatility
- Helps compare different investments
- Useful in SIPs, mutual funds, business growth analysis
🔢 Example:
If an investment grows from ₹1,00,000 to ₹1,80,000 in 3 years:
CAGR ≈ 21.98% per year
⭐ Think long-term. CAGR shows the true growth story.
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