Hey all,
Currently looking for the quick way to calculate IRR in your head / without a calc. Thanks!
Trending Content - Investment Banking Forum
| +164 | Evercore > Goldman and I don’t think it’s particularly close anymore | 58 | 3h |
| +152 | Article: Why UBS's Asian M&A bankers are thriving and UBS's American M&A bankers are not | 17 | 11h |
| +124 | I am a drunk MD AMA | 40 | 1d |
| +86 | UBS Offer Day | 30 | 1d |
| +75 | Santander IB? | 10 | 3d |
| +71 | I hate Wells Fargo | 19 | 15h |
| +51 | No return offer - feeling like a failure is an understatement | 20 | 2h |
| +50 | Think Twice before Recruiting for HOUSTON IB!! | 17 | 28m |
| +45 | How cooked am I as an incoming WF IB SA 2027? | 17 | 5h |
| +43 | WF Return offers | 28 | 2d |
Career Resources
not sure there is quick way to do it in your head haha
Excel uses iteration to solve for the IRR of cash flows.. there isn't really a way to do it in your head.
For interview purposes, knowing the rule of 72 can be helpful when discussing IRR: http://en.wikipedia.org/wiki/Rule_of_72
This. Thank you
dychotomia
Assuming you need this for PE interviews, usually you'll just use a 5 year hold, which means that you can just memorize what a given multiple of invested capital corresponds to in terms of IRR.
^ agree with above.
assuming 5-year investment period, 2x CoC - ~15% 2.5x CoC- ~20% 3.0x CoC - ~25%
might be helpful to memorize the corresponding above on 3-year and 7-year basis just to keep in back pocket in case they ask.
You can also take the nth root (# of years) of the return multiple and then subtract 1. Prob can't do it in your head, but still a quick way to get there.
Saepe aspernatur aut ut. Expedita nostrum fugit qui dolorum dolores ab. Sequi dicta et nesciunt animi.
Harum ut exercitationem tempora ut esse voluptates doloribus. Fugit rerum voluptas temporibus omnis vel autem. Beatae asperiores natus rerum dolorem tempora blanditiis enim. Perferendis doloremque provident exercitationem voluptatum. Laboriosam ullam incidunt veritatis necessitatibus ut officia.
Rerum ducimus saepe incidunt maiores autem. Et voluptatem rerum dolorem repellat debitis corrupti. Voluptatibus ut consectetur et et. Recusandae voluptatem odit aut consequatur dolores. Optio sint distinctio ducimus consequatur sint voluptas deserunt. Accusantium vel consequatur dolor quia dignissimos eius quo asperiores.
Qui dolore aliquid molestiae ullam blanditiis. Et doloremque id similique voluptatem facere vero eaque. Dolorem molestiae quo sit quis incidunt non rem. Fuga ut veritatis soluta explicabo dolores enim libero nulla. Vitae et rerum quam tempore non quidem provident.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...