XIRR Calculator

What Is an XIRR Calculator?

An XIRR calculator computes your true annualised rate of return when you have invested or withdrawn money on multiple, irregular dates — a SIP, a series of lumpsum top-ups, or partial withdrawals. It is the correct way to measure returns whenever cash flows do not happen just once at the start and once at the end.

Why XIRR Matters for SIP Investors

A regular CAGR calculation assumes a single investment made on a single date. But a SIP involves 12, 60 or even 240 separate instalments, each invested on a different date and therefore each compounding for a different length of time. XIRR accounts for every individual cash flow and its exact date, giving you one accurate, annualised return figure across the entire investment.

How XIRR Is Calculated

XIRR finds the discount rate that makes the net present value of all your cash flows, including the final value of your holding, equal to zero:

CF is each individual cash flow, negative for money invested and positive for money received or the current value, and d is the number of days from the earliest date to that cash flow.

There is no direct algebraic way to solve this equation. It has to be solved by iteration, which is exactly why this is a job for a calculator or spreadsheet function rather than manual math.

Matching What Excel Does

Three implementation details matter, because people check XIRR answers against Excel:

• Day count is a flat 365, not actual/actual. That is what Excel uses.
• Rows are sorted by date before solving. The base date is the earliest cash flow, not the first row you typed.
• The solver brackets the answer rather than guessing. Excel’s Newton-Raphson from a 10% guess is fragile on portfolios whose flows alternate sign. This calculator brackets between −99.99% and 10,000% and bisects, which does not fail on real data.

Worked Example

You invested ₹10,000 on 1 January, another ₹10,000 on 1 July, and your holding is worth ₹22,000 exactly one year after the first investment. Because the two instalments were invested for different lengths of time, twelve months and six months, a simple average return would misstate your performance. Running these three cash flows through an XIRR calculation gives the single annualised rate that correctly weights each instalment by how long it was actually invested — in this case, in the region of 12 to 13%.

XIRR vs CAGR vs Absolute Return

Key Takeaways

• XIRR calculates your true annualised return when you have multiple cash flows on different dates, such as SIP instalments.
• It is the most accurate return metric for SIPs, since each instalment has been invested for a different length of time.
• The calculation is solved iteratively, since there is no closed-form formula.
• Comparing XIRR figures across different mutual funds is one of the fairest ways to judge which SIP strategy actually performed better.