XIRR, or Extended Internal Rate of Return, is a formula used to calculate the annualized return on investments with multiple cash flows that occur at different times.
XIRR is used to evaluate the profitability and performance of an investment by taking into account the timing and amount of each individual cash flow in a given period.
XIRR reflects the actual return based on their specific cash flows and accommodates for irregular, non-periodic cash flows.
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