What is 'Internal Rate of Return (IRR)'?

More terms

Accrued interest

The interest earned on a gilt since the last dividend date. When buying a gilt, the buyer pays the accrued interest at the time of a transaction to the seller in addition to the clean price of the gilt

Accounting standards

The rules a company follows when preparing financial statements.

Packaged Retail and Insurance-based Investment Product (PRIIP)

An investment where, regardless of its legal form, the amount repayable to the retail investor is subject to fluctuations.

Investment Trust

A company that pools money together from multiple investors and then invests it.

Running yield

The annual interest payment (dividend) divided by the current market price of a bond.

Arithmetic Mean

The sum of a set of numbers added together and then divided by the total amount of numbers in that set.

United States Dollar (USD)

The famous greenback our friends in the US use as currency.

Retail Prices Index (RPI)

An index published each month by the Office for National Statistics, which measures the level of retail prices in the UK. Cash flows on all index-linked gilts are linked to the RPI.

Total Return

This is the measurement of a fund’s performance in a specific period.

Internal Rate of Return (IRR)