xirr (Financial Toolbox)

xirr	Examples See Also

Internal rate of return for nonperiodic cash flow.

Syntax

yld = xirr(cf, df, guess, maxiter)
yld = xirr(cf, df, guess)
yld = xirr(cf, df)

Arguments

cf: A vector of nonperiodic cash flows. Include the initial investment as the initial cash flow value (a negative number).

df: A vector of dates on which the cash flows occur. Enter dates as serial date numbers or date strings.

guess: Initial estimate of the expected return. Default = 0.1 (10%).

maxiter: Number of iterations used by Newton's method to solve for yld. Default = 50.

Description

yld = xirr(cf, df, guess, maxiter)

returns the internal rate of return for a schedule of nonperiodic cash flows.

Example

An investment of $10,000 returns this nonperiodic cash flow. The original investment and its date are included.


Cash flow	Dates
($10000)	January 12, 1987
$2500	February 14, 1988
$2000	March 3, 1988
$3000	June 14, 1988
$4000	December 1, 1988

To calculate the internal rate of return for this nonperiodic cash flow

cf = [-10000, 2500, 2000, 3000, 4000];
df = ['01/12/1987'
      '02/14/1988'
      '03/03/1988'
      '06/14/1988'
      '12/01/1988'];

yld = xirr(cf, df)

returns

yld =
    0.1006 (or 10.06%)