Replies

my apologies, I am travelling overseas I do not have regular access to the computer. Thank you for the file, I have never used goal seek before and this is wonderful. I have to rewatch the utube for the columns as I did it right before the plane and found it qualitatively wonderful but did not analyze it in detail as you had, I still trust IRR unless you push it to unusual scenarious where it breaks down and I as not aware of thsi fault. My thanks again and when I am back will give all this the time it deserves. Again my thanks
JR

yes you have it exactly. Not certain how to use goal seek to make the xirr compound monthly
Thank you
JR

sorry I have been flying all day. Yes your example and analysis is dead on. I was looking for a way for a way to get some handle on the return and your apporach is correct. Not certain what you mean by “using goal see” is this another formula to plug into? JR

sorry I have been flying all day, not certain what you are asking wrt to ranking/

very interesting, but he is saying the irr is not that reliable either and irr can only be used on a regular periodic basis ie additions each month.
I enjoyed watching it thanks
jr

actually I think I have the hang of it and seems to work fine, Thank you
IS THERE A BETTER estimate or internal average of the amount of principal that is there each year?? Like an IRR on principal.
is it accurate to say you have average of 10k principal if the extra money is put in at the end . if you do an average of principal over 3 years not really accurate, is there more of a time weighted principal equation to see really what your “working principal” is each year to have a better understand of what happened now that one has a better understanding of the true return…
Thanks
JR

-10,000

1-Jan-09-1,0001-Mar-09-1,00030-Oct-10-1,20015-Feb-1115,0001-May-11 0.06593
sorry this just does not seem right 10k is starting deposit, all others are additional deposits, and 15k is the final value, it looks like 15 k is another deposit, no way to differentitate between deposits and final value unless make 15k a positive value. then it shows a 6% return. does that seem roughly accurate??
if i make it all 0’s for extra deposits just to stress the formula then it shows a 19% irr which i think makes sense. just verifying?
-10,000

1-Jan-0901-Mar-09030-Oct-10015-Feb-1115,0001-May-11 0.19019

Sorry I was not clear
lets take a bank account that i put in 10,000 jan 1 2009, and then i put in 1000 into the same account March 1 2010 and 2000 April 1 2011, The total amount invested would be 12000 in this example but now the value as of May 1 2011 is 15000, (12000 of principal and now 3000 in increase in value for whatever reason interest dividend, or assets held in account are just worth more if they are stock) how do I calculate a true rate of return. A simple rate of return does not allow for the extra principal put in at different times. For example if all the extra capital was put in at the end then the return would be much higher than if all the capital went in at the beginning. Just trying to get a better handle on a true rate of return where additional money / principal has been added at odd times between the original opening of the account and say today. JR

Hi HTH
thank you this seems to make more sense, Just to clarify, even if I put in 10,000 into a bank account jan 1 2009,it is a negative number?, and then i put in 1000 into the same account March 1 2010 and 2000 April 1 2011, then these are both positive numbers.
The total amount invested would be 12000 in this example but 10,000 would be negative and 1000 would be positive and 1000 would be positive to get the XIRR? Just seems incosistent and I don’t understand the math well enough
Also where do you put the current value of say 15000, (12000 of principal and now 3000 in increase in value) in the spreadsheet to make it work
JR

Yes, could not really translate the help to my needs.
No dividends or interest received. Just a matter of increase value. basically a non dividend paying stock.
But aren’t dates of additional added capital value important, if capital added late than irr should be higher as bigger result on smaller inital capital and yet I do not see any date parts.
Just confused
Jr

thank you, yes the error message remains with the code
thank you for trying
jerome

perfect, DRAGGING was the charm. Copying and pasting did not work, Could not select all in bulk and double click to install all.
Thx
JK

great perfect many thanks

phenomenal many thanks JK

thanks, there is less and less documentation these days, who knew?
JK