Google Sheets | How to Calculate CAGR only if Percent Returns are Given | Example | Spreadsheet
In Google Sheets, use the CAGR (Compound Annual Growth Rate) formula to calculate the CAGR of an investment. If only percentage returns are given
instead of the amounts, how to calculate the CAGR? A way to get this data
is to add one to each percentage return, multiply them, and use the result in the CAGR formula.
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CAGR (Compound Annual Growth Rate) Formula:
=(Ending value/Beginning Value)^(1/n)-1
Ending value is the value of investment at the end of the investment period.
Beginning value is the initial value of investment.
n is the number of years of investment.
CAGR Example:
Assume an investment of $1000 returns $1165, $1208, and $1362 in a 3-year investment period.
Substitute the ending value and beginning value and the investment time frame in the formula:
Ending value = $1362
Beginning value = $1000
n = 3
=((1362/1000)^(1/3)-1)*100
=10.85%
The CAGR is 10.85%.
Review this video tutorial, which gives the steps to calculate the CAGR,
in Google Sheets, if only percentage returns are given, with examples.