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Re: st: Internal Rate of Return Calculation
From
Austin Nichols <[email protected]>
To
[email protected]
Subject
Re: st: Internal Rate of Return Calculation
Date
Tue, 14 Jun 2011 11:35:02 -0400
Sounds like
http://www.stata.com/statalist/archive/2010-04/msg01113.html
On Tue, Jun 14, 2011 at 2:07 AM, M. S. <[email protected]> wrote:
> Dear Statalisters:
>
> I am searching for a more convenient way to calculate internal rates
> of return. I should mention, that I am not that experienced with Stata
> at this point.
>
> I have a function like this:
>
> Net Present Value = Value0+ value1/(1+irr)^1+ value2/ (1+irr)^2 . . .
> + value6/(1+irr)^5*(irr-growth) – price
>
> To find the discount rate irr that makes the function equal to zero I
> am currently using a forvalues loop which increases or decreases the
> discount factor given the current value of Net Present Value. This
> requires me to recalculate the result all the time and to use several
> if-conditions so that irr is changed by 1% at first and later by 0.1%,
> 0.01% and so on . . .
>
> Is there a more convenient way to find the discount factor? When I
> searched, I only found a function called “finirr” but I couldn´t find
> any documentation for it and my data do not describe as a time series.
>
> I look forward to any input you could give me on that issue and
> really appreciate every help!
>
> Kind regards,
>
> Martin
>
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