IRR

Calculates the internal rate of return on an investment based on a series of periodic cash flows.

Sample Usage

Syntax

IRR(cashflow_amounts, [rate_guess])

• cashflow_amounts - An array or range containing the income or payments associated with the investment.

  • cashflow_amounts must contain at least one negative and one positive cash flow to calculate rate of return, and the first amount must be negative.

• rate_guess - [ OPTIONAL - 0.1 by default ] - An estimate for what the internal rate of return will be.

Notes

• Each cell in cashflow_amounts should be positive if it represents income from the perspective of the owner of the investment (e.g. coupons) or negative if it represents payments (e.g. loan repayment).

• NPV will return zero if discount is set to the result of IRR using the same cash flow amounts.

• If the cash flows of an investment are irregularly spaced, use XIRR instead.

See Also

XNPV: Calculates the net present value of an investment based on a specified series of potentially irregularly spaced cash flows and a discount rate.

XIRR: Calculates the internal rate of return of an investment based on a specified series of potentially irregularly spaced cash flows.

PV: Calculates the present value of an annuity investment based on constant-amount periodic payments and a constant interest rate.

NPV: Calculates the net present value of an investment based on a series of periodic cash flows and a discount rate.

MIRR: Calculates the modified internal rate of return on an investment based on a series of periodic cash flows and the difference between the interest rate paid on financing versus the return received on reinvested income.

In order to use the IRR formula, start with your edited Excellentable:

	A	B
1	Cash Flow Values	estimated_irr
2	-$2,000.00	0.51
3	-$100.00
4	$9,000.00
5	$15,000.00
6		IRR
7		$1.68