# IRR Calculation with multiple investments

Most of the times, most of the searches are returning the IRR calculation just based on a single initial investment.

Imagine you have a plan that asks investors to supply money not only once, and you `dividend the payments into 2 or more sections` within the years.

I have looked at the MIRR concept as well, I think it is telling about re-investing from your cash-flows, if I be right, this is a bit different from the scenario which I defined here, but not totally sure maybe it can work.

I pasted a screenshot of my Excel worksheet which I made, please let me know if it's correct or I need to make some refinements. ** Loss means the timely payments.

** To clarify what I did let me explain the year 1, the project is gaining 500, in the same year the investor should pay another 1300. so the CF and PV of the year as calculated are "-800"

• Look at the XIRR function. It’s what I use for cash flows that are irregular in time and in and out. – Peter K. Jul 1 '18 at 17:12
• I looked at XIRR as well, but not sure, here son't think our timetable be strange, these are all based on years, just what I wanted in this plan is that I wanted to divide the initial payment into two, one at the beginning and the other in the beginning of the 2nd year. What is your idea about what I implemented here in excel, is it right or wrong? How can I fix it? thanks. – Sypress Jul 2 '18 at 9:55
• Your calculation of NPV is wrong (I suspect you're not using the discount rate for the future cash flows) but the IRR is correct. – D Stanley Jul 2 '18 at 16:30
• Just a note, IRR and MIRR will have as many roots as there are changes in direction of cash flow. In this case, there is just one change in direction, but be cautious. The IRR,MIRR in Excel isn't always the correct root. You need to find all the roots and figure out which one is the valid root. – Dave Harris Jul 2 '18 at 19:52
• @Dave Harris thanks for the note, could you please provide an example of what you need? – Sypress Jul 5 '18 at 14:41

• @Sypress Do some research on "present value" since there are many ways to calculate it, but essentially, you divide each cash flow by `(1+r) ^ n` where `r` is the discount rate and n is the number of years`. THen add them all up to find the total PV. In your case, the NPV is the sum of all cash flows with no discounting, so that's why I think your NPV formula does not have the discount factor applied. – D Stanley Jul 5 '18 at 19:20