Free Online Annualized Return Calculator

What the annualized return calculator shows

This calculator answers one question: how fast did my money grow, per year? You give it where an investment started and where it ended, and it turns the whole history into a single yearly rate that you can compare with a deposit, a bond, an index or your own other investments.

Raw totals are hard to compare. "My portfolio is up 77.5%" sounds impressive, but over six years it is about 10% a year, and over twenty years it would be under 3%. A yearly rate puts every investment on the same scale, however long you held it.

The calculator has two modes:

• Start and end value gives the compound annual growth rate, CAGR. Use it when you invested once and did not add or take out money, or when you want the growth of a price or an index.
• With deposits and withdrawals gives the money-weighted annual return, the same figure that the XIRR function of a spreadsheet returns. Use it for a real account where you topped up, took money out or received payouts along the way.

Both modes show the rate, the gain or loss in money, a chart of the value path and a table you can save as a PDF. Everything runs in your browser, and nothing you enter is sent anywhere.

In this guide:

• How to fill in both modes and read the results
• The CAGR and XIRR formulas and the 365-day convention
• Time-weighted versus money-weighted returns, and why your result differs from a fund's
• Averages, short periods, inflation and benchmarks
• A doubling-time table, three worked examples and common mistakes

If you are new to the trade-off between growth and swings in value, read the article on risk and return first.

How to use the annualized return calculator

At the top of the Your numbers panel is the Calculation switch with two choices: Start and end value, and With deposits and withdrawals. Under it come the Start value and the End value. Both accept anything from zero to one billion, and on phones they have − and + buttons. The start value must be above zero, because a return is always measured against the money that was there at the start.

Start and end value mode

Below the values, Enter the period as offers two ways to give the period:

• Years: the Holding period field takes 0.1 to 100 years with up to two decimals, so 2.5 years is fine. A slider covers 1 to 40 years, and the Common periods row fills in 1, 3, 5 or 10 years with one tap.
• Dates: a Start date and an End date. The calculator counts the actual days between them and divides by 365, so a period with leap days comes out slightly longer than a whole number of years.

The defaults are 10,000 growing to 15,000 over 5 years, which is 8.45% a year.

With deposits and withdrawals mode

This mode always uses dates. Below the start and end date is the Deposits and withdrawals list. Each row has a Date, a Type (Deposit or Withdrawal) and an Amount. Add a deposit or withdrawal creates a new row a year after the latest one, which you then edit; you can have up to 60 rows and remove any of them. Amounts are always positive: the Type decides the direction.

The start value is the money in the account on the start date, and the end value is what it was worth on the end date. A row dated before the start or after the end is left out of the calculation, and an info note tells you how many rows were skipped.

Reading the results

The headline is Annualized return (CAGR) or Money-weighted annual return (XIRR), with two decimals. The figures below it depend on the mode:

• Start and end value: Total return in percent, Gain (or Loss) in money, and the Period in years.
• With deposits and withdrawals: Total put in (the start value plus every deposit), Total withdrawn, Net gain (or Loss) and Gain on money put in, the net gain as a share of everything you put in.

A bar splits the end value into the money you put in and what it earned, or shows the loss next to what is left. The Chart tab draws the money you put in as a shaded area and the value at the calculated rate as a line. The table is Year by year in the first mode and Cash flows in the second, listing the start value, every flow and the end value with its years from the start.

Pin to compare keeps the current result. When you change the numbers, the headline shows the difference in percentage points, such as "+5.39 pp vs pinned", and a caption repeats the pinned run: start, end, period and rate. Switching the mode or the display currency clears the pin. The currency switch only changes the symbol; it does not convert the numbers. PDF saves the inputs, the flows, the results and the table, Share shares a link without your numbers, and Reset restores the defaults. On phones the results sit in a bar at the bottom; Details opens the figures and buttons. More options shows how the result is calculated.

How CAGR is calculated

CAGR, the compound annual growth rate, is the constant yearly rate that would take the start value to the end value in the given time, if growth had been perfectly smooth.

CAGR = (End value ÷ Start value)^(1 ÷ years) − 1
Total return = End value ÷ Start value − 1

From 10,000 to 20,000 in 5 years: 20,000 ÷ 10,000 = 2, the fifth root of 2 is 1.1487, so the CAGR is 14.87%. The total return is 100%, but dividing 100% by 5 to get 20% a year would be wrong: at 20% a year, 10,000 would grow to 24,883 in five years. Each year's growth earns growth of its own, so a smaller yearly rate is enough.

CAGR works just as well for a fall. From 10,000 to 8,000 in 2 years is a total return of −20% and a CAGR of −10.56% a year, because the second year's loss is taken from a smaller amount.

When you give the period by dates, years means days ÷ 365. From 15 March 2020 to 15 March 2025 is 1,826 days, or 5.0027 years, because the period contains 29 February 2024. Growth from 10,000 to 16,105.10 gives 9.99% by those dates and exactly 10.00% when you type 5 years. The difference is small, but it explains why two tools can disagree in the second decimal.

CAGR says nothing about the path. An investment that rose steadily and one that halved and then tripled can have the same CAGR. It also assumes the money stayed put: if you added or took out cash, use the second mode.

Money-weighted return (XIRR) explained

When money moves in and out, there is no single "start value" to divide by. The money-weighted return solves this by asking: at which yearly rate would every amount you put in, each from its own date, grow into exactly what you ended up with, counting what you took out along the way?

In the language of cash flows, money you put in is negative for you and money you get back is positive. The start value is the first outflow, each deposit is an outflow, each withdrawal is an inflow, and the end value is the final inflow. XIRR is the rate r that makes the sum of all the flows, discounted to the first date, equal to zero:

Σ CF_i ÷ (1 + r)^((d_i − d_0) ÷ 365) = 0

• CF_i is each cash flow, negative for money in and positive for money out;
• d_i is its date and d_0 the start date;
• 365 is the day count.

There is no closed formula for r, so the calculator searches for it numerically until the equation balances to a tiny tolerance. Microsoft describes the same method for Excel's XIRR function: it discounts every payment based on a 365-day year from the first date and finds the rate iteratively. Feed the calculator Microsoft's own example (10,000 invested on 1 January 2008, payments of 2,750, 4,250, 3,250 and 2,750 back over the following fifteen months) and it returns 37.34%, the same as the spreadsheet.

Without deposits and withdrawals, XIRR and CAGR by dates are the same number: 1,000 growing to 1,210 over 731 days is 9.99% either way. XIRR is CAGR generalised to money that arrives and leaves at different times.

When there is more than one answer

If the cash flows change direction several times, for example you put money in, take more out, then put money in again, the equation can have more than one solution. The calculator then shows the solution closest to 0% with a warning. A spreadsheet starts its search from a guess, 10% by default in Excel, so with such flows it may land on a different solution. Neither is "wrong"; the flows simply do not define one rate. The Gain on money put in figure and the chart help you judge which reading makes sense.

How to collect the numbers for your own account

The best source is your broker's or bank's statement for the whole period. You need four things from it:

1. The start value: the whole account on the start date, holdings at market value plus cash. If the account started from zero, the first deposit is the start: its date is the start date and its amount the start value.
2. Deposits: every transfer of money into the account, dated when the money arrived. Buying and selling inside the account are not flows; they only swap cash for securities.
3. Withdrawals: every transfer out, including dividends and interest the broker paid out to your bank account rather than keeping them in the account.
4. The end value: the whole account on the end date, after fees.

Dividends that stayed in the account and were reinvested need no rows of their own: they are already part of the end value.

Time-weighted vs money-weighted return

There are two honest ways to measure "how did the investment do", and they answer different questions.

The time-weighted return measures the investment itself. It links the returns of each sub-period and ignores how much money was in the account at the time. A fund that gained 20% in year one and lost 10% in year two has a time-weighted return of √(1.2 × 0.9) − 1 = 3.92% a year, no matter when its investors bought. Fund managers report this way because they do not control when clients add or withdraw money; the GIPS standards published by CFA Institute require time-weighted returns for most portfolios.

The money-weighted return measures your experience. It gives more weight to periods when more of your money was invested. Take four investors from 1 January 2024 to 1 January 2026:

A, B and D held the same fund, and C a fund with the same two yearly returns in the opposite order, so every one of them has a time-weighted return of 3.92% a year. Investor B added money at the top and lost on balance; investor C added after the fall and did much better; investor D took most of the profit out before the bad year, so less money suffered the fall. Neither return is wrong: the time-weighted one tells you whether the fund was good, the money-weighted one whether your timing helped or hurt.

That is why the return on a fund's factsheet rarely matches the number in your account. To judge your own decisions, including when you bought and sold, use the second mode of this calculator. To judge the fund, use the fund's published time-weighted figure. If you invest a fixed amount every month, the dollar-cost averaging calculator shows how such a plan plays out, and the article on dollar-cost averaging explains the idea.

Average return vs CAGR

Many reports quote an "average annual return". If that is a simple average of yearly returns, it is almost always higher than what an investor actually earned.

Take three years of +20%, −10% and +15%. The average is (20 − 10 + 15) ÷ 3 = 8.33%. But 10,000 becomes 12,000, then 10,800, then 12,420. The CAGR from 10,000 to 12,420 over 3 years is 7.49%. Applying 8.33% a year for three years would give 12,714, money that never existed.

The gap grows with volatility. A year of +50% followed by a year of −50% averages exactly zero, yet 10,000 turns into 15,000 and then 7,500: a CAGR of −13.40% a year. Losses hurt more than equal gains help, because the gain is taken from a smaller base and the loss from a larger one.

This is one of the reasons risk matters even when the average looks the same: two investments with equal average returns end at different places if one swings more. The article on risk and return explores that trade-off.

Annualizing short periods

Annualizing takes a return over some period and asks what it would be if it continued at the same pace for a full year. For long periods that is just an honest summary. For short periods it can mislead badly.

10,000 that grows to 10,500 in half a year has returned 5%. Annualized, that is (1.05)^2 − 1 = 10.25% a year. An 8% gain in three months becomes 36.05% a year. Neither number is a forecast: a quarter or a half-year of market movement says very little about the next one, and compounding a lucky streak magnifies it.

Professional performance reporting takes a firm line here. The GIPS standards, published by CFA Institute, say that returns for periods of less than one year must not be annualized. A firm with a ten-month track record shows a ten-month return, not an annual one.

The calculator still annualizes short periods, because comparing two short periods on the same scale can be useful. But whenever the period is under a year it shows a warning: annualizing assumes the same pace for a whole year, which short-term ups and downs rarely keep. For decisions, prefer the total return over the actual period.

Nominal and real returns

The rate this calculator shows is a nominal return: growth in the currency you entered, before inflation. If prices rose over the same period, part of that growth only kept your purchasing power where it was.

Real return = (1 + nominal return) ÷ (1 + inflation) − 1

A 12% nominal return in a year with 8% inflation is 1.12 ÷ 1.08 − 1 = 3.70% in real terms. Subtracting 8 from 12 gives 4%, which is close but slightly too high; at high inflation the gap is bigger. A 10% return with 3% inflation is 6.80% real.

To use this with your own result, take the inflation rate for the same years and the same currency. The inflation index calculator works out how much prices rose between two dates from official consumer price data, and the article on inflation and why money loses value explains why the real return is the one that matters for long-term goals.

The currency matters too. A return measured in one currency is not the same as in another if the exchange rate moved. If an investment earned 15% a year in one currency while that currency lost 10% a year against the dollar, the return in dollars was 1.15 ÷ 1.10 − 1 = 4.55% a year. Enter the values in the currency you actually spend.

Comparing with a benchmark

A return on its own does not tell you whether it was good. The natural question is: what would I have earned if I had simply bought a broad index fund instead? To answer it fairly:

• Same period. Use exactly your start and end dates for the benchmark. A few months' difference can change the result by several points.
• Total return. Many headline indices track prices only. Your return includes dividends you reinvested, so compare it with a total return version of the index, or the return of a fund that tracks it. The article on what indices are explains how they are built.
• Same type of return. If you added money over time, compare your XIRR with the XIRR you would have got by putting the same amounts into the benchmark on the same dates. Run both in the second mode, pin one, and the headline shows the gap in percentage points.
• Same currency and costs. Compare after fees on both sides.

For a deposit or a bond, the fair comparison is the effective yearly rate you would actually have earned after tax, with interest reinvested. The fees drag calculator shows how much a gap of even half a point a year costs over time.

Annualized return at a glance

The table shows how long money takes to double at different CAGRs, how the quick "rule of 72" compares, and what 10,000 grows to in 10 years.

The exact doubling time is ln 2 ÷ ln(1 + CAGR). The rule of 72, 72 divided by the rate, is close between about 6% and 10% and drifts away at higher rates. The compound interest calculator projects growth forward year by year, and the article on compound interest and the time value of money explains why a couple of points a year make such a large difference over decades.

Worked examples

Each example shows what the calculator returns. The amounts are in dollars, so choose USD in the currency switch; the rates would be the same in any currency.

Common mistakes

• Using CAGR for an account with deposits. Your own contributions then count as growth, and the rate can be double the truth. Use the second mode.
• Leaving out payouts. Dividends, coupons or rent paid to you are withdrawals. Without them the return looks lower than it was.
• Comparing with a price index. Your return includes dividends; a price index does not. Compare with a total return index.
• Averaging yearly returns. +50% and −50% average zero but are really −13.40% a year.
• Annualizing a few weeks. A good month annualized looks spectacular and means little.
• Confusing nominal and real. 12% with 8% inflation is 3.70% in real terms.
• Mixing currencies. Enter all values in one currency, the one you actually spend.
• Forgetting fees and taxes. Use the value after fees; subtract tax due on selling yourself.

Limitations and next steps

The calculator measures what already happened. It is not a forecast: a past CAGR, however steady it looks, does not promise the next one. It also has limits by design:

• No taxes or inflation. The result is nominal and before any tax on selling.
• No time-weighted return. It measures your money's return; for the fund's own return, use the fund's published figure.
• Up to 60 flows. For a monthly plan over many years, group payments, for example one row per quarter, or use a spreadsheet's XIRR.
• One account at a time. Run each account separately, or add them up into one set of values and flows.
• One pinned result. It is cleared when you switch the mode or currency, press Reset or reload.

The results are arithmetic, not financial advice. To look forward instead of back, try the compound interest calculator for a single sum or the dollar-cost averaging calculator for a regular plan. To plan your whole portfolio, with every asset, loan and goal on one timeline, open Krokfolio, the free on-device planner.