## Excel XIRR function

The XIRR function calculates the internal rate of return (IRR) for a series of cash flows that may or may not be periodic.

#### Syntax

XIRR(values, dates, [guess])

#### Arguments

• Values (required): An array or a range of cells that represents the series of cash flows.

The series of values must contain at least one positive and one negative value:

-- The negative value: represents the cost or payment;
-- The positive value: represents the income.
• Dates (required): A series of dates that corresponds to the values.
1. Dates can be in any order;
2. The date of the initial investment must be first in the array;
3. Dates should be entered:
-- By using the DATE function;
-- As references to cells containing dates;
-- As results returned from other formulas.
• Guess (optional): A number used to estimate what the IRR will be. If it is omitted, uses the default value of 0.1 (10%).

#### Remarks

1. In Excel, dates can be used in calculations as they are stored as sequential numbers. By default, 1/1/1900 is serial number 1, so 12/1/2021 is serial number 40877 because it is 40876 days after 1/1/1900;
2. Dates are truncated to integers;
3. The #NUM! error occurs when one of the following conditions is met:
-- The arguments “values” and “dates” arrays have different dimensions;
-- The argument “values” array does not contain at least one positive and one negative value;
-- Any of the given “dates” precedes the starting date;
-- Excel can’t find an accurate result after 100 iterations.
4. The #VALUE! error occurs when any of the supplied dates is an invalid date;
5. The value of the XIRR is calculated by the following equation:

Where:
-- Pi is the ith or last cash flow (payment);
-- di is the ith or last payment date;
-- d1 is the 0th payment date.

#### Return Value

It returns a numeric value.

#### Example

As shown in the screenshot below, supposing you invested \$10000 for a project in 2015, and expect to generate the following cash flows over the next 6 years. To calculate the internal rate of return using the XIRR function, please do as follows.

1. Select a blank cell (here I select cell G5), copy or enter the formula below and press the Enter key to get the result.

=XIRR(C6:C12,D6:D12)

2. Then you need to change the cell format to percentage.

2.1 Select the result cell, right click and select Format Cells from the context menu;

2.2 In the Format Cells dialog box, under the Number tab, select Percentage in the Category list box, specify the Decimal places and finally click the OK button to save the changes.

Then you can see the result is displayed as a percentage. See screenshot:

#### Related Functions

Excel IRR function
The IRR function returns the internal rate of return for a series of cash flows represented by the numbers in values.

Excel MIRR function
The MIRR function returns the modified internal rate of return for a series of periodic cash flows.

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