The internal rate of return (IRR) measures the return of a potential investment while excluding external factors. IRR helps investors estimate how profitable an investment is likely to be. All ...

This portfolio has grown by 25%. The problem with a simple rate of return is that it gives you no further information. You don’t know how the assets performed while you held them, nor do you ...

From there, you can determine a project's internal rate of return and weigh if that rate is worth pursuing. Here's an example: Say you're on the fence about purchasing a $100,000 piece of equipment.

Q. I have prepared projections for a proposed project, and I want to calculate the internal rate of return. Instead of using Excel’s IRR function, should I use simple math formulas so others can ...

However, CAGR calculates the mean annual growth rate of investment for a specific period of time, while XIRR measures return on investments with irregular cash flows on different dates.