Work out the net present value (NPV) and internal rate of return (IRR) of a series of cash flows, or XNPV and XIRR when they happen on specific dates, like SIP instalments and redemptions.
How to use it
- Choose One a year for regular yearly cash flows, or On dates for real dates.
- Enter money you pay in as a negative number (an investment, a SIP instalment) and money you receive as positive (income, a sale, the current value).
- Enter a discount rate to get the NPV. The IRR or XIRR doesn't need one.
- For a monthly SIP, use Fill in monthly SIP instalments instead of typing every date.
Formulas
NPV = Σ CFt ÷ (1 + r)t, t = 0, 1, 2… years
XNPV = Σ CFi ÷ (1 + r)(di − d1) ÷ 365
The IRR is the r that makes NPV = 0, and the XIRR the r that makes XNPV = 0. There's no formula for them, so the calculator searches for a change of sign starting near 10% (like Excel's default guess), then narrows it down with Newton's method, falling back to halving the range whenever a step would jump out of it. That finds rates Excel needs a guess for, such as the −44.4% in Microsoft's two-year IRR example.
Worked example
- Pay $10,000 today, receive $3,000, $4,200 and $6,800 at the end of years 1 to 3.
- At 10%: −10,000 + 3,000 ÷ 1.1 + 4,200 ÷ 1.12 + 6,800 ÷ 1.13 = −10,000 + 2,727.27 + 3,471.07 + 5,108.94 = $1,307.29.
- The NPV is positive, so the return beats 10%. The IRR, the rate where it's zero, is 16.34%.
- Excel's NPV() would show $1,188.44, because it discounts the first value by a year too: Microsoft's own example.
Tips
- Compare projects by NPV at the same discount rate; a higher IRR on a much smaller project can be worth less.
- For one amount in and one out, the ROI calculator or CAGR calculator is quicker; to plan a SIP, use the SIP calculator.
- Cash flows that change sign more than once (for example -100, 230, -132) can have more than one IRR, so rely on NPV for those.
Checked on 2 October 2026 against Microsoft's Excel help for NPV, IRR, XNPV and XIRR; every example there gives the same result here. Past returns don't predict future ones.
Frequently asked questions
What is NPV?
Net present value is what a series of future cash flows is worth today, at a discount rate that reflects your required return, minus what you pay now. Paying $10,000 today for $3,000, $4,200 and $6,800 over the next three years has an NPV of $1,307.29 at 10%. A positive NPV means the investment earns more than the discount rate.
What is IRR?
The internal rate of return is the discount rate that makes the NPV exactly zero: the yearly return the cash flows earn. For the same example it's 16.34%. Microsoft's IRR example, a $70,000 business earning $12,000 to $26,000 a year for five years, has an IRR of 8.7%.
What's the difference between IRR and XIRR?
IRR assumes cash flows exactly one period apart. XIRR uses the actual date of each one and counts time in days ÷ 365, so it suits investments with irregular dates: SIP instalments, top-ups, partial withdrawals, rent or dividends. That's why it's the usual way to measure SIP returns: each instalment is invested for a different length of time.
How do I calculate the XIRR of my SIP?
Choose "On dates", then open "Fill in monthly SIP instalments": enter the instalment, the first date, how many you've paid and today's value. A year of ₹5,000 monthly instalments worth ₹63,000 a month after the last one has an XIRR of 9.32%. Each instalment was invested for a different time, which is why this is higher than the simple 5% gain.
Why does the calculator say there may be more than one IRR?
When cash flows switch between negative and positive more than once, several rates can make the NPV zero. For example −100, +230, −132 has IRRs of both 10% and 20%. The calculator shows the one nearest 10% and warns you; in that case judge the investment by its NPV at your own discount rate.
Will the results match Excel?
Yes. NPV here counts the first cash flow as today, which in Excel is =NPV(rate, later flows) + first flow. XNPV and XIRR use the same days ÷ 365 convention as Excel: Microsoft's XIRR example gives 0.373362535 (37.34%) and this calculator 0.3733625 (37.34%); its XNPV example gives $2,086.65 at 9% in both.