Beginner Investing/question



I have read about IRR ( internal Rate of Return) and I still don't understand the concept. I am just looking for somebody to explain it to a lay man in very simple example and clear explanation. can you please do that for me.

thank you



Thanks for the question!
Yes, IRR can be confusing.  I found the below link online that I think explains it better than I ever could.  The article starts off pretty technical, but scroll down a little.  It gets better, and by the third or fourth paragraph begins to explain what IRR is used for, what it means, and why.

I hope it helps!

Best Regards,

Paul Henneman
ValuEngine Inc

Beginner Investing

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Paul Henneman


I can answer any questions on investment strategies. Specifically, my expertise lies in long term investment strategies designed to beat market performance while reducing risk. Not get rich quick schemes, but solid investing strategies. DO NOT SEND ME YOUR HOME WORK QUESTIONS! Over one half of the questions I receive are clearly students in finance or economic classes asking for answers to their homework questions. Most of these come from India. I won't answer them, do your own work. However, I welcome all investors trying to negotiate how to invest in stocks, mutual funds, ETF's, and other investments.


15 years in a leadership role at a financial research company. We sell research to institutions such as Wells Fargo, Fidelity, Thomson Reuters, Bloomberg, Bank of NY, Scotia Bank, and others.

Florida International University, University of Florida

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