IRR precision #47
Description
Hello!
I'm seeing a discrepancy calculating IRR compared to Excel. It isn't huge, but when annualising it is enough for it to be a problem.
Consider the following code.
cashFlow = [-206136.99, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 8993.21, 18993.21];
// Calculate monthly IRR
IRR = finance.IRR( { depth: 1500, cashFlow: cashFlow } );
// Annualise IRR
IRR = (Math.pow(1 + IRR / 100, 12) - 1) * 100;
This returns 0.72% (exactly) which annually becomes 8.99% (8.990490026994502).
Compared to Excel which gives me 0.71414% monthly and 8.91% annually (0.0891443135).
I would appreciate any clues as to why this is happening. I find the exact 0.72 a bit suspicious, is it possible that some rounding is happening there?
Cheers!