Withdrawal or disinvestment when using XIRR

[jumbledore]

How does one account for a withdrawal or disinvestment when using the XIRR formula? For example, let's say I put 100K every year in an investment but then in the 5th year I withdraw 200k and transfer it into my bank account. And then starting the next year I continue investing 100k. So does that mean in the 5th year I must show a positive cash flow?

 

[footoo]

Do you want to calculate the accumulative IRR or the IRR for each year?
Either way, the answer to your question is "no".
Post some sample data (dates and amounts).

 

[jumbledore]

Do you want to calculate the accumulative IRR or the IRR for each year?
Either way, the answer to your question is "no".
Post some sample data (dates and amounts).

Actually I am trying to calculate the cumulative IRR on my overall stock investment through an online broker. So whenever I have some excess cash I transfer it to my broker's online account. The amount of cash transferred and the time when I transfer the amount varies. I don't immediately buy stock with it and the money just lies in the broker's account. Sometimes I withdraw such idle cash that is not invested in any stock for my personal use. So my question is when withdrawing this cash should I show it as a positive cash flow because I feel it would not give me an accurate calculation. Basically I am just trying to compare the rate of return from my stock investments to any other safer form of investment such as government securities, bonds or bank deposits.

 

[footoo]

Yes, treat withdrawals as positive cash flows.
Just list all ins and outs, and the current investment valuation at the end.