XIRR Function in Excel
XIRR Function in Excel
In this video tutorial, we will see how to calculate returns on investments where multiple transactions are happening at different times using the XIRR Function in Excel.
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What is XIRR Function in Excel?
XIRR function is also one of the financial functions in excel which is used to calculate the Internal Rate of Return (IRR) in any series of intervals. The good thing about XIRR Function is, it considers only irregular series of cash flow or installment intervals, whereas most of the function in excel gives fine result when regular interval series is selected. XIRR function works when we assign the dates of obtained intervals whether it is regular or irregular and calculates the internal rate of return on that array of cash flow.
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XIRR Formula in Excel
=XIRR(values, dates, [guess])
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Arguments:
Values (Required Argument) –It is the array of values that represent the series of cash flows. Instead of an array, it can be a reference to a range of cells containing values.
Dates (Required Argument) – It is a series of dates that correspond to the given values. Subsequent dates should be later than the first date as the first date is the start date, and subsequent dates are future dates of outgoing payments or income.
Guess (Optional Argument) –It is an initial guess of what the IRR would be. If omitted, Excel takes the default value which is 10%.
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To know more about the Extended Internal Rate of Return. in Excel, you can go to this link:
https://www.educba.com/xirr-in-excel/
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