What is the XIRR of a ₹4,500 monthly SIP from 2017 to 2026?
Based on these numbers, this SIP has an XIRR of about 9.01% — compared to a CAGR of about 4.72% if the same ₹4,95,000 had gone in as one lumpsum.
What is XIRR and why not CAGR?
CAGR assumes a single lumpsum invested once and withdrawn once — it does not fit a SIP, where money goes in on many different dates. XIRR (Extended Internal Rate of Return) solves for the single annualized rate that reconciles all your dated SIP installments against your current investment value, which is why it is the correct metric for SIP returns. This calculator also shows what your CAGR would have been had the same total amount been invested as one lumpsum on your SIP start date — the two numbers usually differ, since XIRR accounts for money arriving progressively rather than all at once.