Formula for CAGR in Forex Trading: A Guide for Academics

5 min read

Compound Annual Growth Rate (CAGR) is a popular formula used to determine the average return of an investment over a given time period. CAGR in Forex is used by many professional traders and investors and is often used to measure a currency pair’s performance. CAGR is calculated by dividing the value of the currency pair at the end of the time period by its original value, and taking the result to the power of one divided by the total time period. This figure is then multiplied by 100 to express it as a percentage.