CAGR answers "what constant annual growth rate would have produced this same total return, compounding every year?" It smooths an actual, lumpy return path (a great year followed by a flat one, say) into one comparable annualized figure, which is what makes it useful for comparing a strategy's returns over 18 months against another strategy's returns over 3 years on equal footing.
CAGR on its own says nothing about the ride along the way. A strategy with an attractive CAGR and a 60% max drawdown is a very different proposition from one with a similar CAGR and a 15% max drawdown, even though CAGR alone can't tell the two apart.
This is exactly why zengtrade's evidence gates never show CAGR (or any return figure) in isolation: it's always paired with drawdown, profit factor, and expectancy, so a smoothed annual number can't hide a genuinely rough or fragile path underneath it.
Educational content, not investment advice. zengtrade is paper-first and non-custodial.