XIRR vs. CAGR What’s the Difference?

XIRR vs. CAGR What’s the Difference?

Investing can be tricky! XIRR and CAGR are two key metrics to understand your returns.

What is CAGR?

CAGR stands for Compound Annual Growth Rate. It shows how much an investment has grown yearly, on average.

What is XIRR?

XIRR (Extended Internal Rate of Return) is a more flexible measure. It considers the timing of cash flows, like SIPs.

Key Difference

The key difference? CAGR assumes one-time investment, XIRR handles multiple transactions.

When to Use CAGR?

Use CAGR for single, lump-sum investments over a period.

When to Use XIRR?

Use XIRR for multiple transactions like SIPs or irregular cash flows.

Ready to track your investments? Start using XIRR and CAGR today!