Beyond CAGR: How IRR reveals the real impact of investment timing
The timing of investments and withdrawals can change investment returns. IRR helps measure that impact. Suppose two investors put the same total amount into the same fund, but at different times. One puts a large amount into the fund just before a market rally, while the other invests a large amount
The Bharath News1 min readSource: ET Real Estate
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The timing of investments and withdrawals can change investment returns. IRR helps measure that impact. Suppose two investors put the same total amount into the same fund, but at different times. One puts a large amount into the fund just before a market rally, while the other invests a large amount just before a market decline. The fund’s performance is the same for both investors, but their personal returns can be very different.
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