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 Microsoft Excel > Functions > Financial > IRR
 

IRR(values [,guess])

 
 Returns the percentage return (or loss) of an initial investment.

 valuesThe array or a reference to cells that contain numbers for which you want to calculate the internal rate of return.
 guessThe number that you guess is close to the result of IRR.

 REMARKS
 
  		• The internal rate of return is the interest rate received for an investment consisting of payments (negative values) and income (positive values) that occur at regular periods.
     
  		• The rate of return calculated by this function is the interest rate corresponding to a 0 (zero) net present value.
     
  		• The cash flows must occur at regular intervals, such as monthly or annually.
     
  		• This function uses an iterative technique for calculating IRR.
     
  		• Starting with the value "guess" the function iterates through the calculation until the result is accurate within 0.00001 percent.
     
  		• If "values" does not contain at least one positive value and one negative value, then #NUM! is returned.
     
  		• This function uses the order of values to interpret the order of cash flows so make sure to enter your payment and income values in the sequence you want.
     
  		• If an array or reference argument contains text, logical values, or empty cells, those values are ignored.
     
  		• If "guess" is left blank, then 0.1 (or 10 percent) is used. In most cases you will not need provide a "guess".
     
  		• If this function can't find a result that works after 20 tries, then #NUM! is returned.
     
  		• If this function returns a value that is not close to what you expected, you can try again with a different value for "guess".
     
  		• If this function returns #NUM! you can try again with a different value for "guess".
     
  		• This function is closely related to the NPV() function.

     EXAMPLES
     
     AB
    1=IRR({-10,10}) = 0% 
    2=IRR({-10,0,10}) = 0% 
    3=IRR({-10,0,0,10}) = 0% 
    4=IRR({-20,10,10}) = 0% 
    5=IRR({-30,10,20}) = 0% 
    6=IRR({-60,20,20,30}) = 8% 
    7=IRR({-60,20,30,20}) = 8% 
    8=IRR({-60,30,20,20}) = 9% 
    9=IRR({-20,10,10,10}) = 23% 
    10=IRR({-20,10,10,10,10}) = 35% 
    11=IRR({-50,10,20}) = -26% 
    12=IRR({-10,10,20}) = 100% 
    13=IRR({-20,10,20}) = 28% 
    14=IRR({40,10}) = #NUM! 
    15=IRR(B1:B6) = #NUM! 
    16=IRR("-10;10") = #VALUE! 
    		 
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