What is XIRR?
XIRR stands for Extended Internal Rate of Return. It is a method used to calculate the annualised return on a series of cash flows that occur at irregular intervals — for example, a recurring investment made monthly, quarterly, or yearly, followed by a final maturity value on a later date.
Unlike a simple return calculation, which assumes a single investment over a fixed period, XIRR accounts for the fact that each instalment was invested on a different date and therefore had a different amount of time to grow or shrink in value. This makes it the more accurate way to measure returns on recurring investments like SIPs, where money goes in periodically rather than all at once.
How does the XIRR Calculator work?
The calculator builds a full schedule of cash flows based on your investment frequency, recurring amount, start date and maturity date, then finds the single annualised rate of return that makes the net present value (NPV) of all these cash flows equal to zero. Because cash flows occur on different dates, there's no simple formula like there is for CAGR — XIRR is solved iteratively, testing different rates until the correct one is found. This is the same method used by the XIRR function in Excel and Google Sheets.
Worked example: Suppose you invest ₹10,000 every month, starting 1 January 2023, with a maturity date of 1 January 2026 — a 3-year monthly investment totalling 36 instalments. Your total amount invested works out to ₹3,60,000. If your investment is worth ₹60,000 at maturity, that's an absolute return of −83.33% on the amount you put in. Because the loss happened gradually over 36 monthly instalments rather than all at once, the calculator accounts for the exact timing of each instalment and arrives at an annualised XIRR of approximately −84% — reflecting how steeply the value declined relative to when each rupee was actually invested.
This example also shows why XIRR matters: a simple absolute return tells you that you lost 83.33% of your capital, but it doesn't tell you the rate at which that happened per year. XIRR gives you that annualised figure, accounting for the fact that money invested in month one had three full years to lose value, while money invested in month thirty-six had almost none.
How do I use the Chola Securities XIRR Calculator?
Using the calculator takes four steps.
- Step 1 — Select your investment frequency. Choose how often you invested — 14 days, monthly, quarterly, half-yearly, or yearly.
- Step 2 — Enter your start and maturity dates. Add the date your first investment was made and the date you want to calculate your return as of.
- Step 3 — Enter your recurring investment amount. This is the fixed amount you invested at each interval.
- Step 4 — Enter your total maturity amount. This is the current or final value of your investment at the maturity date.
The calculator instantly shows your XIRR, along with a Wealth Projection chart comparing your total invested amount against your portfolio's actual growth over the period, your total number of investments, and your estimated gain or loss in absolute terms.
Why use the XIRR Calculator?
- Get an accurate annualised return — XIRR accounts for the exact timing of every instalment, unlike a simple return calculation.
- Evaluate SIP performance properly — since SIP instalments are invested at different times, XIRR is the correct way to measure their real annualised return, whether your investment has grown or declined.
- See your investment trajectory visually — the Wealth Projection chart shows how your invested amount compares with actual portfolio growth over time.
- Compare investments fairly — use XIRR to compare returns across investments with different cash flow patterns on a like-for-like basis.
The result is calculated based on the frequency, dates, and amounts you provide. It reflects past or hypothetical performance only and does not predict or guarantee future returns.