What Is XIRR? The True Measure of SIP Returns
XIRR (Extended Internal Rate of Return) calculates the annualized return on investments with irregular cash flows — making it perfect for measuring SIP returns.
Why Not Just Use CAGR?
CAGR works for a single lump-sum investment. But SIPs involve multiple investments at different times. XIRR accounts for each cash flow's timing to give an accurate annualized return.
How to Calculate XIRR
XIRR is the discount rate that makes the NPV of all cash flows (investments and redemptions) equal to zero. Use Excel's =XIRR() function or our calculator.
Good XIRR Range
Equity SIPs: 12-15% XIRR over 7+ years is good. Debt funds: 6-8%. Hybrid: 9-12%. Returns vary by market conditions and timing.