Calculator Inputs
Enter one cash flow per line. Period 0 is usually the initial investment. Use equal time spacing between periods.
Example Data Table
Example assumptions: finance rate 8%, reinvestment rate 10%, periods per year 1, annualized MIRR 9.03%.
| Label | Cash Flow |
|---|---|
| Year 0 | $-100,000.00 |
| Year 1 | $18,000.00 |
| Year 2 | $22,000.00 |
| Year 3 | $26,000.00 |
| Year 4 | $30,000.00 |
| Year 5 | $34,000.00 |
Formula Used
MIRR = (FV of positive cash flows / |PV of negative cash flows|)^(1 / n) - 1
Annualized MIRR = (1 + periodic MIRR)^(periods per year) - 1
PV of negative cash flows discounts all negative values to period 0 using the finance rate.
FV of positive cash flows compounds all positive values to the final period using the reinvestment rate.
n is the number of periods between the first and last cash flow. This method separates borrowing cost from reinvestment assumptions, which gives a more realistic result than basic IRR in many practical cases.
How to Use This Calculator
- Enter a scenario name so each export is easy to identify later.
- Type the finance rate used for funding negative cash flows.
- Type the reinvestment rate used for positive cash flows.
- Set how many periods occur in one year, such as 12 for monthly data.
- Paste the full cash flow series, starting with period 0.
- Add optional labels if you want named periods in the results table.
- Press Calculate MIRR to show the result above the form.
- Use the CSV or PDF buttons to export the summary, graph inputs, and schedule details.
FAQs
1. What does MIRR measure?
MIRR measures the return of a project after separating the cost of financing from the rate used to reinvest incoming cash flows. That makes it easier to evaluate projects with more realistic assumptions than traditional IRR.
2. Why is MIRR often preferred over IRR?
Traditional IRR can imply that every positive cash flow is reinvested at the same internal rate. MIRR replaces that assumption with a user-defined reinvestment rate, which usually reflects business reality more clearly.
3. Do I need both positive and negative cash flows?
Yes. MIRR needs at least one negative cash flow and one positive cash flow. Without both directions, there is no valid financing side and no valid return side to compare.
4. What should I enter for periods per year?
Use 1 for yearly cash flows, 4 for quarterly cash flows, 12 for monthly cash flows, and so on. This setting converts the periodic MIRR into an annualized rate for easier comparison.
5. Can I use uneven cash flow amounts?
Yes. The amounts can change every period. What should remain consistent is the spacing between periods, because MIRR assumes the listed cash flows occur at equal time intervals.
6. What does the terminal value multiple mean?
It compares the future value of all positive cash flows with the present value of all negative cash flows. A larger multiple generally supports a stronger MIRR, assuming the same number of periods.
7. Why does the calculator show both periodic and annualized MIRR?
Periodic MIRR reflects the exact interval of your cash flows. Annualized MIRR converts that periodic rate into a yearly figure, which makes different projects easier to compare on a common basis.
8. Does a higher MIRR always mean the project is better?
Not always. MIRR is useful, but project size, duration, risk, liquidity, and strategic goals also matter. A higher MIRR should be reviewed alongside cash flow scale and other decision metrics.