software

Help please?

I have a property portfolio spreadsheet containing

Purchase Date 28/2/03
Purchase cost ?161,053

Current Valuation Date 31/3/06
Current valuation ?194,984

Costs ?4,832

How can I calculate my return on the investment using XIRR or is this
not the correct function to use?

Any help please--
Robo
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XIRR is more if you have an irregular cash flow, see the example below.

Internal Rate of Return (for non-periodic cash flow)

(40,000,000)October 1, 1997
23,440,000 February 23, 2001
6,560,000 May 23, 2001
(11,500,000)December 5, 2002
46,500,250 December 31, 2004

8.90%XIRR(B3:B7,C3:C7,0.01)

In the formula, B3:B7 is the cash flow amounts. C3:C7 are the dates, and
0.01 is the guess. You need at least one negative cash flow for the XIRR to
work. I don't think this is the correct formula for you. I'm not sure if
you can calculate it without any cash flows. Sorry I couldn't be more
helpful. At least maybe you learned about XIRR?

Jaclynquot;Roboquot; wrote:

gt;
gt; Help please?
gt;
gt; I have a property portfolio spreadsheet containing
gt;
gt; Purchase Date 28/2/03
gt; Purchase cost 拢161,053
gt;
gt; Current Valuation Date 31/3/06
gt; Current valuation 拢194,984
gt;
gt; Costs 拢4,832
gt;
gt; How can I calculate my return on the investment using XIRR or is this
gt; not the correct function to use?
gt;
gt; Any help please
gt;
gt;
gt; --
gt; Robo
gt; ------------------------------------------------------------------------
gt; Robo's Profile: www.excelforum.com/member.php...oamp;userid=12058
gt; View this thread: www.excelforum.com/showthread...hreadid=531854
gt;
gt;

quot;Roboquot; wrote:
gt; Purchase Date 28/2/03
gt; Purchase cost 拢161,053
gt; Current Valuation Date 31/3/06
gt; Current valuation 拢194,984
gt; Costs 拢4,832
gt;
gt; How can I calculate my return on the investment using
gt; XIRR or is this not the correct function to use?

It probably is. You fail to say when the costs were incurred.
On the other hand, the costs are such a small percentage, I
suspect the timing would not make much difference.

You can approximate the __daily__ IRR with one of the following,
making different extreme assumptions about when the costs
are incurred:

=RATE(DATE(2006,3,31)-DATE(2003,2,28),,-161053,194984-4832)
=RATE(DATE(2006,3,31)-DATE(2003,2,28),,-161053-4832,194984)

There are different schools of thought about how to annualize
the daily IRR. Many/most people say: simply multiply by 365.
I prefer to compound it, viz. (1 RATE(...))^365 - 1.

Or you could use XIRR, using the actually date(s) of the costs
or using the midpoint: INT((DATE(2006,3,31) DATE(2003,2,28))/2).

The difference between the two RATE() formulations
0.14-0.15 pct points, depending on how you annualize.
So I do not believe using XIRR will give you significantly
different results in this case.
Thank you both. Very helpful--
Robo
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