Subtract the starting year from the ending one to calculate the investment duration. Number of years= ending year-starting year In our example, number of years=2009-2005=4
Divide one by the number of years. 1/number of years. In our example, it would be 1/4=0.25.
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Divide the ending value by Starting Value and raise the quotient in the power of the number from Step 2. In our example, it would be ($25,000/$20,000) ^0.25= 1.0574.
Subtract one from the number obtained in Step 3 and multiply by 100 percent to get CAGR in percents. In our example, CAGR=(1.0574-1) x 100 percent=5.74 percent.