IRR function

G

Guest

When we calculate an IRR using the IRR function with
yearly and monthly cash flow payments we are getting very
different results. The monthly payments sum up to the
yearly payments.

Any insight would be appreciated.
 
M

Myrna Larson

Since you don't use dates with IRR, it calculates the return *per period*,
i.e. monthly rate if you enter monthly cash flows, annual rate if you enter
only 1 cash flow per year. Are you taking that into account?
 
P

Paul Corrado

You are getting the monthly rate of return when you calculate the result on
the monthly data and an annual rate when you use the annual data.

PC
 

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