Читать книгу Alternative Investments - Hossein Kazemi - Страница 43

This section begins with two major types of complications in the computation and interpretation of IRRs. In the previous section, IRR was easily computed and interpreted because of the simplified cash flow patterns used and because the investment was being viewed in isolation. The first complication arises when an investment offers a complex cash flow pattern other than the traditional pattern of a cash outflow to initiate an investment, followed only by cash inflows until the investment is terminated. The second complication occurs when investments must be compared to see which is preferred. These two complications are addressed in the first half of this section, followed by a brief discussion of other challenges.