One client recently asked me, Why does my mutual fund portfolio show 9% absolute returns, 21% XIRR, and a different CAGR?

Well, here’s the simplified difference

Absolute Returns – The total gain or loss on your investment without considering time. Its like looking at the start and finish of a race but ignoring how long it took.

CAGR (Compound Annual Gross Rate) - This shows the steady growth rate as if your investment grew at the same rate every year. Its ideal for comparing investment over a fixed period.

XIRR (Extended Internal Rate of Return) - This goes one step further it accounts for all the cash flow. (When you added or withdraw money) and calculates your actual annualized return, considering the time value of money.

For my client, the portfolio is absolute return was 9% (Start to finish growth) CAGR showed how the portfolio would have grown if it had compounded evenly over the holding period. But XIRR told the most accurate story, reflecting real return based on timing of their investments, which was 21%.

Each metric has its role, but XIRR often given the clearest picture when there are multiple transactions.

Are you looking at the right numbers when reviewing your investments?

Blog by Mr. Santosh G Akerkar for Educational and Knowledge purposes only.

Best Regards,
Santosh Akerkar

We started writing Blogs to convey our thought process, our top relevant data and our contrarian approach (By God’s grace it worked well so far).

Here are some of our previous Blogs in which we predicted and it worked.

Blog 1 – Can ‘SILVER’ Become ‘GOLD’ [ Dated: 30/04/2025]
Silver ($ 36) has given breakout and rally may continue. Silver is a part of Multi Asset Allocation Fund. Its going to be multiyear rally for Silver . 

Blog 2 – What to do in market decline [ Dated: 25/04/2025]
During Equity market corrections we always advise to add Lumpsum. In last correction we advised Equity (Large cap) through mutual funds. In April and May Equity market bounced well. Those who invented Lumpsum apart from their SIP s benefitted . 

Blog 3 - Gold Father - Golden Rally of Gold [ Dated: 25/04/2025]
Gold rally is fuelled by central Banks buying. Gold and dumping US treasuries since Rasia-Ukraine war. This trend has accelerated in Trump era. We have been bullish on Gold since 2019-2020. Encouraged our clients to buy SGB, we are taking bet on Gold from Multi Asset Allocation fund. (Minimum 10% allocation to gold).One can consider Gold etf as well . 

Blog 4 – Increase your surface area [ Dated: 28/02/2024]
In this blog we suggested to invest across Asset class and globe through MF. Diversification is key to mitigate risk in investment. This has also helped our clients. We have some funds where we take global exposure. (US, Europe, Chiana, Japan) through MF.

Blog 5 – Long Indian Bonds [ Dated: 26/02/2024]
Yesterday in surprise move RBI decided to cut interest rates by 50 BPS and CRR has been surprisingly cut by massive 100 BP.

This 3rd Repo Rate cut by RBI in the last one year. It has helped Bond Market particularly medium duration funds, (12.5% Last year) Low duration funds and hybrid funds.

So we will read ,study, and analyze data and information . We will share key data and inputs with you.

Let's grow together

Blog by Mr.Santosh G Akerkar for education and awareness purposes.
Best Regards,
Santosh Akerkar

While investors' interest in gold is soaring, it’s also a great time to look at silver as a compelling alternative.

• Silver demand has outpaced supply for the 4th consecutive year.
• Gold to silver ratio is at 88:1 well above the long-term average of 65:1 indicating that silver is undervalued.
• Indicators suggest that silver still is relatively attractive v/s gold and like gold silvers extended up more still pending.

Why Now?
Silver offers a more attractive entry point relative to gold and could be the undervalued gem in your portfolio.

Word of Caution
Silver is a very volatile commodity and often moves wildly. It is not for everyone, especially not for the faint hearted. Most investors are better off having it as part of a Multi Asset Allocation strategy through an MF.

For others who understand these nuances having some exposure to this commodity using silver FOF could make sense.

Silver currently trades at  $ 32.9/ troy, ounce and rupees 96000 per kg.

Blog by Mr.Santosh G Akerkar for education and awareness purposes.
Best Regards,
Santosh Akerkar