XIRR / CAGR Calculator
Two ways to measure investment returns. Use CAGR for one-time lumpsum investments with a single start and end value. Use XIRR when your cashflows are irregular — SIPs, lumpy additions, partial withdrawals, mutual fund investments with monthly purchases, or stock investments with staggered entries.
CAGR — Compound Annual Growth Rate
Use when you invested a single amount on day 1 and want to know the annualized return by a later date.
When to use CAGR vs XIRR
| Scenario | Use | Why |
|---|---|---|
| Bought ₹1 lakh of a stock in Jan 2020, worth ₹2.5 lakh today | CAGR | Single investment, single current value |
| Started a ₹10,000/month SIP in Jan 2021, want to know return as of today | XIRR | Multiple investment dates (12+ per year) |
| Lumpsum ₹5 lakh in a mutual fund, reinvested dividends for 3 years | XIRR | Dividends count as additional investments at different dates |
| Invested ₹2 lakh at IPO, held one name, current market value | CAGR | Single purchase, clear end value |
| Added ₹50,000 lumpsum in 2022 on top of existing SIP | XIRR | Irregular cashflow timing |
| PPF/EPF where government / employer contribute monthly | XIRR | Multiple contribution dates |
Understanding your XIRR result
| XIRR Range | Interpretation |
|---|---|
| Below 6% | Underperforming most fixed deposits — consider if risk is justified |
| 7-10% | Roughly matching inflation; equivalent to low-risk debt funds |
| 10-13% | Decent equity MF performance; market-comparable |
| 13-18% | Above-market return; sustainable for quality portfolios over long periods |
| 18-25% | Strong alpha — hard to sustain long-term but achievable in bull cycles |
| Above 25% | Exceptional — likely boosted by specific successful bets; sustainability is the question |
The math (for the curious)
CAGR formula: CAGR = (End Value / Start Value)^(1/years) − 1
So if you turned ₹1 lakh into ₹2 lakh over 5 years: (2/1)^(1/5) − 1 = 14.87% CAGR.
XIRR formula: XIRR is computed iteratively (Newton-Raphson). It finds the annualized rate r such that the net present value of all cashflows equals zero:
Σ (cashflow_i / (1 + r)^(days_i / 365)) = 0
The calculator above uses Newton-Raphson iteration to converge on the correct rate, the same algorithm used in Excel’s XIRR() function.