Xirr

To calculate the internal rate of return for a schedule of cash flows that is not necessarily periodic.

Installation

• If you are using Gradle just add the following dependency to your build.gradle.

implementation "com.github.joutvhu:xirr:1.1.2"

• Or add the following dependency to your pom.xml if you are using Maven.

<dependency>
    <groupId>com.github.joutvhu</groupId>
    <artifactId>xirr</artifactId>
    <version>1.1.2</version>
</dependency>

Using

To use the xirr function you need to create a Xirr object.

You can use the Xirr.instance() method to create a Xirr object. Xirr cycles through the calculation until the result is accurate within 0.000001 percent. If Xirr can't find a result that works after 100 tries, you'll get a XirrException.

You can also change the accuracy and tries using the Xirr.of(double accurate, double tries) method.

// Xirr.instance() -> precision = 0.000001, tries = 100;
Xirr xirr = Xirr.instance();

// Xirr.of(double precision, double tries);
Xirr xirr1 = Xirr.of(0.000001, 1000);

The Syntax of the xirr function:

• Xirr.xirr(Transaction[] transactions)

• Xirr.xirr(Transaction[] transactions, double guess)

• Xirr.xirr(double[] values, long[] days)

• Xirr.xirr(double[] values, long[] days, double guess)

The arguments of the xirr function:

• values required. A series of cash flows that corresponds to a schedule of payments in dates. The first payment is optional and corresponds to a cost or payment that occurs at the beginning of the investment. If the first value is a cost or payment, it must be a negative value. All succeeding payments are discounted based on a 365-day year. The series of values must contain at least one positive and one negative value.
• days required. A schedule of payment dates that corresponds to the cash flow payments. Dates may occur in any order.
• transactions required. A series of pairs of value and day.
• guess optional. A number that you guess is close to the result of Xirr. If omitted, guess is assumed to be 0.1 (10 percent).

// rate ~ 0.35899244 ~ 35.90%
double rate = Xirr.instance().xirr(
        new Transaction(-10000,"2008-01-01"),
        new Transaction(2750,"2008-03-01"),
        new Transaction(4250,"2008-11-30"),
        new Transaction(3250,"2009-02-15"),
        new Transaction(2750,"2009-04-01")
);

Accuracy of Result

The xirr is closely related to xnpv, the net present value function. The rate of return calculated by xirr is the interest rate corresponding to xnpv = 0.

The library provides the xnpv functions so you can double-check the accuracy of the results if you want.

• Xirr.xnpv(double rate, Transaction[] transactions)

• Xirr.xnpv(double rate, double[] values, long[] days)

With:

• rate required. is result from the xirr function, which is the discount rate to apply to the cash flows.

The closer the result of the xnpv function is to zero, the more accurate the calculated rate value.