Excel MIRR Function

Summary

The Excel MIRR function is a financial function that returns the modified internal rate of return (MIRR) for a series of cash flows, taking into account both discount rate and reinvestment rate for future cash flows.

Purpose

Calculate modified internal rate of return

Return value

Calculated return as percentage

Syntax

=MIRR (values, finance_rate, reinvest_rate)

Arguments

values - Array or reference to cells that contain cash flows.
finance_rate - Required rate of return (discount rate) as percentage.
reinvest_rate - Interest rate received on cash flows reinvested as percentage.

Usage notes

The standard Internal rate of return function (IRR) assumes all cash flows are reinvested at the same rate as the IRR. The modified internal rate of return function (MIRR) accepts both the cost of investment (discount rate) and a reinvestment rate for cash flows received.

In the example shown, the formula in F6 is:

=MIRR(B5:B11,F4,F4)

In this example, we assume that the reinvestment rate is the same as the cost of capital, so we set both the finance_rate and reinvest_rate to the value in F4, which is 10%.

Notes

The values array must contain at least one positive value and one negative value.
Values should be in chronological order.
MIRR assumes cash flows at regular periods.