We Design Your Financial Destiny


(Precious) Words of Wisdom : "Who is the ideal adviser? A person who likes you but doesn't care about your feelings." ~ Daniel Kahneman

Simple Trick To Calculate SIP Returns In Excel

Systematic Investment Planning (SIP) is by far the best way to invest in mutual funds... especially equity mutual funds.

However, many investors often get confused when it comes to calculating how much they have actually earned from their SIP investment.

Simply dividing the total gains by the total investment is incorrect. It does not account for the different no. of days that each SIP amount has been invested for.


However, using excel sheet and a very simple strategy — known as Weighted Average Method — you can calculate the exact returns of your SIPs in just a matter of minutes.

A self-explanatory example of the same is given below.

sip-returns-calculator


In fact, this weighted average methodology can be applied not only to your SIPs, but also to other such irregular investments.

By the way, there is still simpler option to calculate returns of a scheme for investments made on different dates.

This is the XIRR formula in Excel.

XIRR is quite similar to calculating IRR. All you have to do is to also include the dates into the formula.

This is explained in detail in my blog Learn How to Calculate TRUE investment returns or TRUE loan cost.

An Investment In Knowledge Pays The Best Interest ~ Benjamin Franklin

You Learn A Lot By READING... And Even More By SHARING.

Share Button

Ignorance is like a SIGNED BLANK CHEQUE... anyone can MISUSE it.

Subscribe via Email
Powered by Blogger.

... Three VALUABLE Tips ...

1. How Rs.1 Lakh Became Rs.1 Crore In Mutual Fund Scheme
Reliance Growth Fund
Stay invested through all the rough and tough times.

 


2. Guaranteed Income Insurance Plans Misinform Misguide Mislead
Guaranteed Income Insurance Plan
I sincerely hope you spill coffee over guaranteed income insurance form.

 


3. Should You Opt For Home Loan With An Overdraft Facility?
Home Loan With Overdraft Facility
Wondering whether an Overdraft Account linked to Home Loan is Ok or not?