Excel University Blog
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IRR
When it comes to evaluating investments in Excel, most people immediately jump to the familiar NPV and IRR functions. While these are incredibly powerful, they can lead to incorrect conclusions if we don’t fully understand how they work, especially when cash flows vary or are irregular. In this post, we’ll walk through six powerful finance…
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When it comes to evaluating the performance of investment opportunities in Excel, many of us start with the IRR (Internal Rate of Return) function. While helpful, it carries assumptions that don’t always fit real-world situations … especially when financing costs or different reinvestment options are involved. That’s where MIRR (Modified Internal Rate of Return) becomes…
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If we need to calculate the internal rate of return (IRR) for a series of cash flows occurring on irregular dates, the standard IRR function in Excel falls short. That’s where XIRR steps in. The XIRR function allows us to incorporate actual dates for each cash flow, offering a more precise and reliable result which…
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When evaluating where to invest our money, whether it’s in education, a new business, or a CD, understanding the rate of return is essential. Thankfully, Excel makes this process straightforward with the IRR function, or Internal Rate of Return. This function helps us calculate the annualized rate our cash flows will earn over time. In…
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