XIRR Calculator

What This Tool Does

XIRR (Extended Internal Rate of Return) gives you a single annualized return figure for an investment made up of multiple transactions on different dates — like a SIP with irregular top-ups, or a lumpsum investment with a later withdrawal. This calculator works out that rate from your transaction dates and amounts.

You can also use this Discount Calculator.

How It’s Calculated

XIRR is defined as the rate that makes the net present value of all your cash flows — each discounted back to its actual date — equal zero. Investments are treated as negative cash flows (money going out) and redemptions or maturity value as positive (money coming in).

For multiple irregular transactions, there’s no simple algebraic formula — the rate has to be found by testing values until the equation balances, which is exactly what Excel’s XIRR function and this calculator do automatically.

For the simplest case — a single investment followed by a single payout — the formula does simplify:

XIRR = (Maturity Value ÷ Investment Amount)^(365 ÷ Days Held) − 1

Worked example: ₹1,00,000 invested on 1 January 2023, maturing to ₹1,25,000 exactly two years later (730 days).

• Ratio: 1,25,000 ÷ 1,00,000 = 1.25
• Exponent: 365 ÷ 730 = 0.5
• XIRR = 1.25^0.5 − 1 = 1.118 − 1 = 11.8%

For a SIP with monthly contributions instead of one lumpsum, the same underlying logic applies to every individual transaction date, but solving it requires the iterative method rather than this simplified formula.

Edge Cases and Special Rules

• Sign convention matters: Every investment must be entered as a negative cash flow and every withdrawal or maturity value as positive — get this backwards and the result won’t make sense.
• Needs at least one of each: XIRR can’t be calculated with only outflows or only inflows — there must be at least one negative and one positive cash flow.
• Short durations can distort results: A strong short-term gain annualized through XIRR can produce a very large percentage that wouldn’t hold up if extended over a full year — treat short-window XIRR figures with caution.
• Iterative solvers need a starting guess: Tools like Excel’s XIRR function require an initial guess rate to begin searching from; a poor guess can occasionally cause the calculation to fail to converge.

XIRR vs. CAGR vs. IRR

These three get mixed up often. CAGR (Compound Annual Growth Rate) assumes a single lumpsum investment with no cash flows in between — it’s simple but breaks down the moment you add regular contributions or withdrawals. IRR (Internal Rate of Return) handles multiple cash flows but assumes they occur at evenly spaced intervals. XIRR removes that restriction entirely, using actual calendar dates for every transaction — which is why it’s the standard choice for SIPs, where contribution dates rarely land at perfectly even intervals.

Who Uses This

• SIP investors wanting an accurate annualized return across irregular monthly contributions
• Investors who’ve made a lumpsum investment and want a straightforward annualized figure
• Anyone who has made partial withdrawals or top-ups and needs a return figure that accounts for timing
• Investors comparing performance across different funds or strategies with different transaction patterns

XIRR vs. Absolute Return

These measure different things. Absolute return is simply the total percentage gain over the entire holding period, with no adjustment for time — a 25% gain looks the same whether it took six months or six years. XIRR annualizes that return, accounting for exactly when each cash flow happened, which makes it possible to fairly compare investments held for different lengths of time or funded at different points.

FAQ

What does XIRR mean?

Extended Internal Rate of Return — a single annualized return rate that accounts for the actual dates of every cash flow in an investment.

How is XIRR different from CAGR?

CAGR only works for a single lumpsum with no interim transactions; XIRR handles multiple irregular contributions or withdrawals.

Can I calculate XIRR in Excel?

Yes, using the built-in XIRR function, which takes a list of cash flow values and their corresponding dates.

Do I need more than one transaction to calculate XIRR?

You need at least two cash flows — one investment (negative) and one redemption or maturity value (positive).

Is a higher XIRR always better?

Generally yes, but be cautious with very short holding periods, where annualizing can produce an inflated-looking percentage.

Try It Above

Enter your investment dates, amounts, and maturity value in the calculator above to get your annualized XIRR instantly. Figures are for general estimation only and depend on the accuracy of the dates and amounts entered.