XIRR Calculator

XIRR stands for Extended Internal Rate of Return. It is an important metric that helps you estimate the actual rate of return from the multiple transactions of your market-linked investments occurring at different times. Read more to learn how to use the XIRR Return Calculator and how it works.

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Disclaimer:# The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. All SIPs listed here are of insurance companies’ funds.
  • Insurance Companies
  • Mutual Funds
Returns
Fund Name 3 Years 5 Years 10 Years
Virtue II PNB Metlife 18.68% 25.83%
16.48%
View Plan
Pure Equity Birla Sun Life 17.56% 21.84%
15.07%
View Plan
Large Cap Equity Fund Tata AIA 18.45% 21.82%
14.88%
View Plan
Grow Money Plus Fund Bharti AXA 14.74% 18.58%
14.12%
View Plan
Pure Stock Fund Bajaj Allianz 17.34% 20.53%
14.04%
View Plan
Diversified Equity Fund HDFC Standard 14.77% 17.79%
13.96%
View Plan
Growth Super Fund Max Life 15.5% 17.5%
12.83%
View Plan
Equity Fund SBI 14.88% 16.53%
12.1%
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Bluechip Fund ICICI Prudential 13.23% 15.89%
11.33%
View Plan
Equity Large Cap Fund Edelwiess Tokio 12.3% 15.39%
11.21%
View Plan

Updated as of Nov 2024

Compare more funds

  Returns
Fund Name 3 Years 5 Years 10 Years
Active Fund QUANT 24.92% 31.48%
21.87%
Flexi Cap Fund PARAG PARIKH 20.69% 26.41%
19.28%
Large and Mid-Cap Fund EDELWEISS 22.34% 24.29%
17.94%
Equity Opportunities Fund KOTAK 24.64% 25.01%
19.45%
Large and Midcap Fund MIRAE ASSET 19.74% 24.32%
22.50%
Flexi Cap Fund PGIM INDIA 14.75% 23.39%
-
Flexi Cap Fund DSP 18.41% 22.33%
16.91%
Emerging Equities Fund CANARA ROBECO 20.05% 21.80%
15.92%
Focused fund SUNDARAM 18.27% 18.22%
16.55%

Updated as of Oct 2024

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What is XIRR?

The full form of XIRR is the Extended Internal Rate of Return. It is a way to calculate the annual return on an investment that has multiple cash flows occurring at different times.

The XIRR returns consider the specific timing of each transaction. This makes it a more accurate measure of investment performance in real-world scenarios.

This method is generally used to calculate the returns on Systematic Investment Plans (SIP), when you invest or redeem different amounts over different periods from your investment plans like mutual fund schemes and Unit Linked Insurance Plans (ULIP Plans).

NOTE: A higher XIRR shows a better investment performance. However, other factors, such as risk and volatility, should also be considered.

What is the XIRR Calculator?

An XIRR calculator helps you to calculate the Extended Internal Rate of Return (XIRR) for a series of varying cash flows in a SIP investment plan. This calculator finds a single rate of return which can be applied to each of your investments or withdrawals to give the current value of your total investment.

How to Calculate XIRR?

You can calculate the XIRR for your SIP investments using the XIRR function available in Microsoft Excel.

XIRR Formula in Excel: 

The calculation formula for the XIRR Calculator online is as follows:

Extended Internal Rate of Return = XIRR (value, dates, guess)

Where,

  • values: A range of values representing the cash flows.

  • dates: A range of dates corresponding to the cash flows.

  • Guess*: An optional parameter that provides an initial guess for the XIRR.

*If omitted, Excel will use a default value of 0.1 (10%).

Steps to Use XIRR Calculator in Excel

  • Step 1: Add the date entries for the following in the cells of the “Date” column-

    • Outflows (investments/ purchases) and

    • Inflows (redemption/ returns)

  • Step 2: In the next column, list all the transactions in front of the particular date entry. Mark entries as per the following-

    • Mark outflow entries as negative (-)

    • Mark inflow entries as positive (+)

  • Step 3: In the last row, enter the current value of your total holdings and the current date.

  • Step 4: Use the XIRR function in Excel: =XIRR(values, dates, [guess])

Illustration of XIRR Calculation:

Let us take an example with investments in an SIP plan for 10 months as the following transactions:

Date SIP Amount
01/02/2023 -20000
02/02/2023 -500
03/10/2023 -300
04/02/2023 10000
05/17/2023 27000
06/05/2023 105
07/08/2023 -500
08/01/2023 10000
09/10/2023 4500
10/14/2023 -1000
XIRR = 8.826828074

For the above cash flows, the XIRR is 19.36% p.a. This annual rate of return is generated by considering the period of particular investments for different transactions.

Calculation Formula for XIRR Calculator in a SIP

XIRR is calculated by solving for the rate of return for all the cash flows. The in-built calculation formula used in Excel is mentioned below:

The XIRR calculator works on the basis of the following formula
XIRR = n=0NPi1 + RDi – D1365
Terms used in XIRR Calculator
Pi
Payment amount
N
Number of the transaction
D1
Initial date of investment
Di
Date of the transaction
R
Interest Rate

Benefits of XIRR Calculator

The following list mentions the key advantages of using an XIRR Calculator online:

  • The XIRR provides accurate performance of your SIP investments while considering the different transactions at different time intervals.

  • It is the most suitable annual return rate calculator for irregular cash flows.

  • Provides an annual rate of return to easily compare with other investment options.

  • Helps you to make an informed decision making for your future financial goals.

  • It is a fast and hassle-free way to automatically calculate your XIRR returns. 

Conclusion

The XIRR calculator is a valuable financial tool that helps you to accurately assess the performance of your irregular investments in your SIP plan. This calculator simplifies complex calculations and contributes to more effective financial planning.

FAQs

  • What does 10% XIRR mean?

    A 10% XIRR means that an investment has returned 10% per year, on average, over a specified period of time, taking into account the timing of cash flows.
  • Is 20% XIRR good?

    A 20% XIRR is considered to be a very good return for most investments. It is important to note that past performance is not indicative of future results, but a 20% XIRR over a sustained period of time would be very impressive.
  • What is the formula for calculating XIRR?

    The formula for calculating XIRR is as follows:

    XIRR(values, dates, [guess])

    • values: A range of values representing the cash flows.

    • dates: A range of dates corresponding to the cash flows.

    • guess: An optional parameter that provides an initial guess for the XIRR. 

  • What is XIRR in the SIP calculator?

    XIRR in the SIP calculator stands for Extended Internal Rate of Return. The XIRR function in the SIP calculator will take into account the timing of your investments and the actual returns you earned on each investment, and it will give you a more accurate estimate of your overall return on investment.
  • How is XIRR calculated?

    The XIRR is generally calculated using a spreadsheet software like MS Excel. You can calculate your annual rate of return by inserting the cash flows for their respective dates and applying the formula: ‘=XIRR(values, dates, [guess])’. 
  • What is a good XIRR rate?

    A good XIRR rate for different types of investments are given below: 
    • Equity investments: a good XIRR ranges between 12 – 15% p.a.

    • Debt investments: a good XIRR ranges from 6 – 10% p.a.

  • Is XIRR equal to CAGR?

    No, XIRR is not equal to CAGR, although both these are a measure of investment performance. While CAGR provides a smoothed annual growth rate assuming consistent growth, XIRR provides a more precise annualized return by considering the actual dates and amounts of cash flows.

Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
*All savings are provided by the insurer as per the IRDAI approved insurance plan.
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^Section 80C allows annual deductions of up to ₹1.5 lacs from the taxable income. Section 10(10D) provides tax-free maturity benefits for investments of up to ₹2.5 Lacs/ year, on policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.

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