XIRR Calculator
Understanding XIRR
The XIRR calculator helps you determine the annualized return rate of a series of cash flows occurring at irregular intervals.
Key Concepts:
- Invested Amount: The amount of money initially invested.
- Maturity Amount: The amount of money at the end of the investment period.
- Frequency: The regularity with which investments are made (e.g., daily, monthly, quarterly, half yearly, or yearly).
- Start Date: The date when the investment period begins.
- Maturity Date: The date when the investment period ends.
How it Works:
The calculator estimates the annualized return rate based on the provided cash flows and their respective dates.
Calculation Formula:
XIRR
is calculated using an iterative method, often involving numerical algorithms to solve for the rate that satisfies the following equation: