XIRR, CAGR और Absolute Returns क्या होता है? | Mutual Funds | ET Money Hindi
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- Опубликовано: 26 июл 2022
- If you get confused listening about Mutual fund returns, then, you are not alone. It is a little difficult to understand mutual funds returns. Most people get intimidated listening to heavy words like CAGR, Absolute Reuters, XIRR, etc. But, this will not happen anymore.
In this video, we will tell you about different types of mutual funds returns and will discuss how they are different from each other, and...
There is one important thing. All mutual fund returns - whether it is CAGR or XIRR, tell about the historical aspects meaning older returns of the fund. Through them, you get to know about the performance of the fund during the chosen period. They are not predictions for future returns.
👉 CAGR - Compounded Annual Growth Rate.
CAGR is the return type that is most commonly used while discussing the performance of any fund.CAGR tells you about the compounded growth rate of your mutual fund investments.
CAGR can help you understand this. In order to calculate the Compounded Annual Growth Rate (CAGR) we need - Initial Investment Value (IV), Final Investment Value (FV), and period of investment (n).
The formula to calculate CAGR is:
CAGR = (Final Investment Value/Initial Investment Value)^1/n - 1
In this manner, you can check the CAGR of different funds over 3, 7, and 10 years of different time frames.
So, next time when you hear or know about the CAGR of a fund, then be understood that this is the average annual returns that a fund has generated over a time period.
First, CAGR does not give you a clear picture of volatility. Seeing this, you may feel that your investment has had or had a linear growth. This means that it has grown at a fixed rate every year, however, the reality is that the value of the investment may differ every year.
Second, though CAGR is the most used and popular way to calculate mutual fund returns, it has a limitation, that it doesn’t take into account the periodic investments. In the example given above, if the investment was made on different dates in the year, then, CAGR would not have been able to give a correct picture of the returns. It is ideal for calculating returns from a point-to-point basis. Therefore, CAGR is a correct method to calculate returns for a one-time lump sum investment, but not to calculate the SIP returns.
So, the question arises that if CAGR is not the correct method to measure the returns from SIP investment then what is?
👉 XIRR - Extended Internal Rate of Return
CAGR is fine for lump sum investments, but in places where there are different cash inflows and outflows, like SIPS, CAGR is not a good measure.
That is because every installment of a SIP is a new investment, therefore each amount is invested for different time durations. For example, in a 5-year SIP, your first installment will be invested for 5 years, the second installment for 4 years 11 months, and so on. For this reason, every amount gets compounded for different periods.
The Extended Internal Rate of Return (XIRR) takes this into account. In XIRR, CAGR is calculated for every installment and then the overall Compounded Annual Growth Rate is taken out after adding them all together.
You can calculate the XIRR in excel but we have made it much easier. You can see the SIP returns of every fund for any amount and duration on the scheme page of ETMONEY.
So, till now we have discussed the returns from mutual funds investments held for more than a year. Now, you must be getting the question: how to calculate the returns on investments for a year or less? The answer to it is Absolute returns.
👉 Absolute Returns
Absolute returns or Total returns means how much you have gained or lost in your investment.
Whenever you choose an equity fund, then do not judge the fund with its absolute or one-year returns, but evaluate it on the basis of CAGR or XIRR meaning more than a year (3/5/7/10 year’s returns).
👉 Bottom Line:
At the end of the day, we all invest in mutual funds to grow our money and earn better returns. So by knowing the intricacies related to mutual fund returns, you can pick the best funds for yourself. Once you’re invested, it also helps you gauge whether you got a good return for your money or not. You can use these returns to evaluate your mutual fund investments with other avenues like bank deposits, gold, and more.
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Bhai itne ache aur ground zero se samjhane k liye hats off
till the time i didnt saw this video i was confused in all three, but this man removed all the doubts in just 8 min, fantastic video brother
Thank you! Do share ahead with your friends as well
ET money is a perfect channel that provides best knowledge for better learning. Their ways of explaining are soft and clear. Thanks a lot for sharing valuable knowledge in short time.
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Best explanation till now on the topic 👍
This is the Best explanation video on this topic. 👍
Nicely explained..thanks for knowledge🙏
Thanks.....aapka bhala ho
Very informative...thanks ETMONEY
Thanks for your education
Perfect explanation sir
Very much informative.
बहोत बढिया ✨✨✨
Excellent, you explain a simple way to understand
Very nice explanation 👌
Marvelous lecture❤
Wonderful explanation 👏
Very nice explanation
Thank you so much 🙏
Well explained 👍
Great explanation sir
आप छा गए।
बेहतरीन जानकारी।
Shukriya :)
Good information
Thanks a lot for this great and helpful video.
We are glad you liked our video..!
My best mutual fund teacher in my share market ❤❤❤
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Thank you sir ❤❤❤
best explanation
Very nice
Thnq for clearing my doubt
Lovely explanation ❤
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Good
+ MS excel has a direct formula to calcute XIRR.
How did you calculate the xirr as you didn't tell the final value of Corpus made by SIP
Hello sir we are all new in stock market and we want to do intraday trading. Sir everyone says start with small amount, look at the market, learn and give all the tips for intraday, sir, my request is so much from you that you should learn step by step till you become a beginner advanced so that anyone can easily learn. Sir, what I mean is that if we keep watching the same chaat over and over again, nothing more is going to happen than this. Tell all the flower process by which a beginner can do it and learn something from the mistake made by it. Most of the blank keep watching, see the prize went down came up, this keeps going on every day, please make all the full tutorial videos by watching which make a mistake and learn something from that mistake and how to recognize your mistake. love you sir 🥰🥰
Mt krto bhai mere 3 lakh loss huye he ik din paisa chala jata he
So if I add many lumpsum amount within fewer years then how will i calculate cagr for that
Eg 2 installment of 50 k in a year and again 50k next year and withdraw at third year
Et money me stp ka option kaha se aata hai
How is Insurance calculated of 5 years premium of 1 lakh every year and maturity 10yrs? Is XIRR perfect?
Agar 1yr ke liye har mahine sip ke through invest kare to wo return kese calculate hoga cagr, xirr ya absolute??
I have invested in 8 funds, all funds XIRR above 25% but aggregate XIRR is only 19% ?
Sir what is the correct meaning of xirr 20 ?
मैं पेटीएम मनी से Sip करता हूं कोई दिक्कत?
👌👍
👌🙏
Sir Maine aaj hi tata cap main sip li hai .aur uska xirr ( -54) hai ...iska kya mtlb hai
Aapne jis din liya hoga usi din loss hua hoga tumhara kuchh 0.2 percent ka kuchh din ruko portfolio profit me aa jayega
So basically 5 yrs later it went 51% up overall?? Is that correct?
Yes
No nhi aya smajh yah chij ap ko pta hai isliye ap isko itna jaldi bta diya or apko lga ki ham smajh gye cagr to smajh a gya but xirr kese hai kya smajh nhi aya
1
Xirr अभी भी समझाने में आप सफल नही हो पाए
Sir agr 3 year me 3 lakh se kam profit hu toh LTCG tax lagega ya nhi?
जिस साल कैपिटल गेन एक लाख से अधिक होगा , बढ़े हुये रकम पर LTCG टैक्स देना होगा।
Sir wo tax kitne percentage ka Hota hai?
@@shivamsahutrader एक लाख के ऊपर जितना होगा, उसका 10 percent.
XIRR value Kam ya besi kon acha hai
Agar XIRR ki value badi hai, matlab fund ne zayda return diya hai. Aur agar XIRR kam hai, to matlab return bhi kam hua.
Mera Xirr 17.56 ka h
Kya ye achaa
Hi, koi bhi investor ko long term (more than 7 years) mei agar 12% se zayda return milta hai, to wo achha consider kia jata hai.
Aap Customer care number update Karo
Axis blue chip fund 😢😢😢
Too much numbers and calculations
LoL keep uploading the same old video for views