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Excel XNPV Function

Excel XNPV function
Summary 

The Excel XNPV function is a financial function that calculates the net present value (NPV) of an investment using a discount rate and a series of cash flows that occur at irregular intervals.

Purpose 
Calculate net present value for irregular cash flows
Return value 
Net present value
Syntax 
=XNPV (rate, values, dates)
Arguments 
  • rate - Discount rate to apply to the cash flows.
  • values - Values representing cash flows.
  • dates - Dates that correspond to cash flows, in any order.
Version 
Excel 2003
Usage notes 

The Excel XNPV function calculates the net present value (NPV) of an investment based on a discount rate and a series of cash flows that occur at irregular intervals. Values represent cash flows and be correspond to dates. Negative values represent cash paid out; positive values represent cash received. Dates represent a schedule of payments and must be valid Excel dates. The first date indicates the beginning of the schedule of payments and must be the earliest date. Subsequent dates may occur in any order.

Example

In the example shown, the formula in F6 is:

=XNPV(F4,B5:B10,C5:C10)

XNPV doesn’t discount the initial cash flow. Subsequent payments are discounted based on a 365-day year.  To discount to a particular valuation date, you can set up XNPV so that the first cashflow is zero, associated with the valuation date.

Notes

  • Rate is provided as a percentage (.12 for 12%)
  • Dates do not need to be in chronological order.
  • Dates must be valid Excel dates
  • XNPV doesn’t discount the initial cash flow
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