CAGR & XIRR Calculator
Measure your investment's actual annualized return — use CAGR for a single lumpsum, or XIRR when you've invested at multiple points in time.
CAGR
Absolute return: 150%
CAGR smooths out the growth into a single annual rate — useful for comparing investments with different holding periods, even though actual year-to-year returns were almost certainly uneven.
Choosing Between CAGR and XIRR
If you invested a single amount once and want to know its annualized growth rate, CAGR is the right tool — simple, fast, and easy to compare across different investments. But most real portfolios involve multiple transactions at different times: a SIP, an extra lumpsum during a market dip, maybe a partial withdrawal. In those cases, CAGR can't properly account for when each rupee was actually invested, which is exactly the gap XIRR fills by weighting each cash flow by its specific date.
Frequently Asked Questions
What's the difference between CAGR and XIRR?
CAGR works for a single investment made once and held for a known period — it smooths the growth into one annual rate. XIRR is for investments with multiple cash flows at different dates (e.g. several lumpsum top-ups, or a SIP with an early withdrawal) — it accounts for the exact timing of each flow rather than just the start and end points.
Why does my mutual fund app show XIRR instead of CAGR?
Because most real investments aren't a single lumpsum — SIPs, additional purchases, and partial withdrawals all create multiple cash flows at different dates. XIRR is built to handle exactly that, which is why platforms use it as the standard returns metric instead of CAGR.
Can XIRR be negative?
Yes — a negative XIRR means your investment lost value annualized over the period, which can happen with significant market downturns relative to your investment timing.
Why might the XIRR calculation fail to converge?
XIRR is solved numerically, and certain unusual cash-flow patterns (e.g. all flows on the same day, or alternating signs in an extreme pattern) can fail to converge to a single rate. Double-check your dates and amounts if you see this.