What is XIRR?
XIRR (extended internal rate of return) is the single yearly rate of return that explains every rupee you invested and withdrew, on the exact dates each amount moved. It is the right way to measure a mutual fund portfolio built from SIPs, lump sums and redemptions at different times.
Last updated 2026-10-26
The definition
Find the rate r so that the sum of cash_flow(i) / (1 + r)^(days(i) / 365) over all dated cash flows equals zero, where days(i) is the number of days from the first cash flow. Money you invest counts as negative, money you take out (and the current value of what you still hold) counts as positive.
A worked example
You invest Rs 1,00,000 on 1 January 2023. On 1 January 2025 (731 days later) it is worth Rs 1,21,000, and you made no other deposits or withdrawals. The XIRR is about 9.99% a year: the money grew by 21% over a little over two years, which is roughly 10% a year compounded. Add a second deposit in the middle and a simple percentage can no longer describe it, but XIRR still can.
Why absolute return is not enough
Absolute return is gain divided by the amount invested. It says nothing about time: a 20% gain in one year and a 20% gain over ten years look identical, though the first is far better.
A fund's published trailing return describes the fund, not you. If you invested through a monthly SIP, or bought more after a fall, your own return can differ a lot from the fund's.
XIRR versus CAGR
CAGR (compound annual growth rate) works when there is one investment at the start and one value at the end. XIRR handles any number of investments and withdrawals on different dates, so it is the one to use for SIPs and for portfolios you have added to over time.
For a single lump sum with no other cash flows, XIRR and CAGR give the same number.
How FolioQ computes your XIRR
FolioQ reads the dated purchases, redemptions and switches from your detailed CAMS or KFintech statement, adds the value of your holdings at the statement date as the final inflow, and solves for the rate numerically across all your schemes together.
If the statement does not cover your full investment history, or the calculation cannot settle on a rate, FolioQ labels the figure an estimate and shows the simpler non-annualised return instead of an exact-looking wrong number.
XIRR describes the past. It is not a forecast, and it is not a recommendation to buy, sell or hold anything.
See also XIRR in plain English: a longer walk-through that starts from a fixed deposit and covers SIPs, redemptions and the limits of XIRR.
Upload your CAS statement to see your own XIRR.
FolioQ is an information tool, not investment or tax advice, and is not registered with SEBI. Read the disclaimer.