Compound Monthly Growth Rate (CMGR)

Data Products Course Project

Pam Wood Pate
Data Analyst

Defintion

Paraphrased from www.investopedia.com/terms/c/cagr.asp:

The month-over-month growth rate of an investment over a specified period of time. The compound monthly growth rate is calculated by taking the nth root of the total percentage growth rate, where n is the number of months in the period being considered.

Why?


Why CMGR?

  • Often compound yearly growth rate is not realistic

Why Shiny App?

  • Calculates the formula automatically, just enter necessary values

Formula

  • CMGR = Compund Monthly Growth Rate
  • L = Last Month's value
  • F = First Month's value
  • N = Total Number of Month's

CMGR = ((L / F) ^ (1 / N)) - 1

Function

CMGR <- function(last, first, n) {
  paste(round((((last / first) ^ (1 / n)) - 1) * 100, digits = 2), "%")
  }

CMGR(200,100,4)

## [1] "18.92 %"