Why you need XIRR, not CAGR, for SIPs
When you invest once and check the value later, CAGR gives the annual return. But with a SIP, each instalment has been invested for a different length of time. The first has had years to grow; last month's has had a few weeks. Comparing total invested with current value, and dividing by the years, understates or overstates your real return. XIRR solves this by treating each transaction on its own date.
Find r so that Σ cash flowₖ ÷ (1 + r)^(tₖ) = 0Worked example
How to use it with your mutual fund statement
- Download your Consolidated Account Statement (CAS) from CAMS, KFintech or your investment app.
- Enter every purchase (SIP instalments, lump sums) as Invested, with its date.
- Enter any redemptions as Withdrawn.
- Add a final row with today's date and the current value as Withdrawn / value.
For a regular SIP, use Fill a monthly SIP to create the rows in one step.
Reading the result
- Compare your XIRR with a benchmark, such as a Nifty 50 index fund over the same dates, or with the FD rate you'd otherwise have earned.
- XIRR over less than a year can swing wildly, because a short-term gain gets annualised. Judge equity funds over 3–5 years or more.
- Most apps show XIRR in the portfolio screen; this calculator lets you check it, or combine accounts across apps.
Frequently asked questions
What is a good XIRR for a SIP?
Over 5+ years, many diversified equity funds have delivered 10–14% XIRR, but results vary by period. Compare with an index fund over the same dates.
Why is my XIRR different from my app's?
Check that every transaction and date matches, including dividends reinvested and the exact current value date.
Can XIRR be negative?
Yes, if the current value is below what you invested, adjusted for timing.