What's the difference between ROI and CAGR?
ROI measures the total profit percentage regardless of duration — whether it happened over one month or 10 years. CAGR converts that profit into a compounded annual growth rate, letting you fairly compare investments with different durations. That's why a 20% total return over one year has a much higher CAGR than a 20% total return over 5 years.
Why didn't I get an annualized (CAGR) figure?
If the investment period is very short (under a week), calculating a compounded annual rate produces unrealistic numbers (potentially thousands of a percent) due to how the exponent math behaves over very short periods. The calculator hides the figure instead of showing a misleading value, and just shows the total return.
Should I add dividends/distributions to the final value?
Yes, if you received cash dividend distributions and didn't reinvest them, add them to the 'final value' so the number reflects your full actual return. If they were automatically reinvested (as in accumulation funds), they're usually already reflected in the investment's current value.
Why does the inflation-adjusted real return matter?
Because the real goal of investing is usually to grow your purchasing power, not just the number in your account. If your investment returned 5% annually while inflation was 6%, you're actually losing purchasing power despite a positive nominal number — this is what the real return reveals.
