Does Zerodha display XIRR and CAGR for equity investments?
Zerodha does not display XIRR and CAGR for equity investments for a few reasons. CAGR is appropriate when there is a single investment, and the performance has to be measured after a few years. However, most investors have multiple investments, including systematic investment plans (SIP). In the case of regular investments, the right metric to use is XIRR. The issue with calculating XIRR is that all the holdings and investments since inception have to be considered, which is complicated further by the inclusion of intraday trades that do not contribute to long-term returns, and doing this at scale across millions of clients with billions of rows of data is a technical challenge.
Zerodha is working on a solution for this, and a comprehensive performance metric will be available on Console soon. In the meanwhile, XIRR can be easily calculated on Excel using tradebook. To know the steps to download a tradebook, see Where can the trades that are taken for a particular period be seen? To learn how to calculate XIRR on Excel, visit support.microsoft.com/en-us/office/xirr-function-de1242ec-6477-445b-b11b-a303ad9adc9d .
Zerodha displays XIRR for mutual funds investments on Coin along with other details. To learn more, see How to check the details of a mutual fund investment on Coin app? To learn more about measuring mutual funds returns, visit zerodha.com/varsity/chapter/measuring-mutual-fund-returns/.