Frequently Asked Questions
CAGR (Compound Annual Growth Rate) = (End Value / Start Value)^(1/Years) - 1. For example, ₹1 lakh growing to ₹1.8 lakh in 5 years: CAGR = (1.8)^(1/5) - 1 = 12.47% per year.
XIRR (Extended Internal Rate of Return) accounts for the timing of each SIP installment and is the most accurate measure for SIP returns. It differs from simple CAGR because each installment has a different holding period.
Absolute return is total gain/loss as a percentage: (Current - Invested)/Invested × 100. CAGR annualizes this return considering the holding period. For short-term investments (< 1 year), absolute return is used.
Equity funds held > 1 year: 12.5% LTCG on gains above ₹1.25 lakh per year (FY 2024-25). Debt funds (all holding periods): taxed as per income tax slab. ELSS funds have 3-year lock-in but same LTCG tax.
About this calculator
This calculator tells you how well a mutual fund holding has done. Enter what you invested, what it is worth now and how many years you held it, and it returns the CAGR, the absolute return and the profit. A second mode works from NAV: enter the purchase NAV, the current NAV, the units and the holding period.
Use it for lump-sum investments. If you invested through a SIP, the money went in on different dates, so CAGR will mislead you. Use the XIRR calculator for that case.
How to use it
- Choose Lump Sum (CAGR) or NAV-Based Returns at the top.
- For a lump sum, enter the Investment Amount, the Current Value and the Investment Period in years.
- For NAV-based, enter the Purchase NAV, Current NAV, Units Purchased and Holding Period.
- Press Calculate Returns.
- Read the CAGR, absolute return, profit and current value.
CAGR versus absolute return
Absolute return = (Current − Invested) ÷ Invested ignores time. CAGR = (Current ÷ Invested)1/years − 1 converts it to a yearly rate you can compare with a bank deposit or another fund.
Worked example
₹1,00,000 grown to ₹1,80,000 in 5 years
| Absolute return | 80.00% |
| Profit | ₹80,000 |
| CAGR | 12.47% a year |
An 80% gain sounds large, but spread over five years it is 12.47% a year, a respectable equity result rather than an exceptional one.
Tips and common mistakes
- Always compare CAGR with the fund's benchmark index over the same period, not with zero.
- Use the regular-plan versus direct-plan NAV that you actually hold. Direct plans have a lower expense ratio and a higher NAV over time.
- Returns quoted for under one year are absolute. Longer than a year they are annualised.
- For SIPs use XIRR. CAGR on the total invested understates the true return.
- Check the exit load and capital gains tax before redeeming. They reduce what you keep.
Frequently asked questions
What is CAGR in a mutual fund?
It is the constant yearly rate that would take your investment from its starting value to its current value over the holding period.
Why does my fund app show a different return?
Apps often use XIRR, include dividends or use a different date range. Check the dates and whether the figure is annualised.
What is absolute return?
It is the total percentage gain or loss, ignoring how long it took.
Can I use this for SIPs?
Not accurately. SIP instalments are held for different periods. Use the XIRR calculator.
What is a good mutual fund return?
Equity funds have historically returned about 10 to 13% a year over long periods in India, but with large swings. Compare with the benchmark.
Are returns taxed?
Yes. Equity fund gains held over 12 months are long-term and taxed at 12.5% above ₹1.25 lakh a year. Shorter holdings are taxed at 20%.