Creating a XIRR Table in DAX

To calculate the Extended Internal Rate of Return (XIRR) based on transaction dates and corresponding cash flows, you can follow the steps outlined below. This includes the DAX formula required to construct a table that calculates XIRR.

Key Concepts

• XIRR: A financial function that calculates the internal rate of return for a series of cash flows that occur at irregular intervals.
• Transaction Date: The dates when cash flows occur.
• Cash Flow Amount: The amounts associated with each transaction.

DAX Formula to Create a XIRR Table

Assuming you already have a table named Transactions with the following columns:

• TransactionDate (date type)
• CashFlow (numeric type indicating inflows and outflows)

You can create a calculated table for the XIRR calculation using the following DAX formula:

XIRR_Table = 
ADDCOLUMNS (
    VALUES ( Transactions[TransactionDate] ),
    "CashFlow", 
    CALCULATE (
        SUM ( Transactions[CashFlow] ),
        FILTER ( Transactions, Transactions[TransactionDate] = EARLIER(Transactions[TransactionDate]) )
    )
)

Explanation of the DAX Formula

1. ADDCOLUMNS: This function creates a new table by adding calculated columns to an existing table.

2. VALUES ( Transactions[TransactionDate] ): Generates a unique column of transaction dates from the Transactions table.

3. "CashFlow": This is the new column being created, where the cash flow sums are calculated.

4. CALCULATE: This function changes the context in which data is evaluated. In this case, it sums cash flows.

5. SUM ( Transactions[CashFlow] ): This sums the cash flows associated with each unique transaction date.

6. FILTER: This ensures that only the cash flow for the current transaction date is considered while summing.

Practical Illustration

Suppose you have the following Transactions table:

If you implement the above formula, XIRR_Table will look as follows:

Using XIRR Function (for Actual Calculation)

To compute the XIRR using the data from the XIRR_Table, use the following DAX statement:

Calculated_XIRR = 
XIRR (
    XIRR_Table[CashFlow],
    XIRR_Table[TransactionDate]
)

Explanation of the XIRR Function

• XIRR: This function requires two arguments: cash flows and corresponding dates.
• It will return the internal rate of return over the series of cash flows provided in XIRR_Table.

Conclusion

This structured approach allows you to create a table for calculating XIRR effectively. By using the DAX formulas provided, you can analyze investment performance based on the timing and magnitude of cash flows.

For advanced learning in DAX and financial analysis, consider the resources available on the Enterprise DNA platform.