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Financial Metric - IRR

Financial Metrics Example: Investments' return rate

This is a business case example of the use of 3 financial metrics components in order to measure the profitability of some investment projects.

The business case:
Imagine you are a firm that wants to invest in 3 different ways.
One way is to begin building an orchid, and for that you plan 3 different projects for which the costs and returns are not regular.
The second and third ways are different financial investments.
The second is in form of several regular monthly investments projects while the third one is in in the same form but you have the additional information of knowing the cost of the capital and at which rate the returns will be reinvested.

After getting the data of the investment projects, which stocked into different excel files, congregated into three different flows divided by type of investments as previously described we begin begin enriching it with the computation of the financial formulae.

In the end we have an overview of all the projects with the return rate for each of them and a visualization to have a ranking of which are the best investment opportunities for the firm in the case.

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Investments' Return Rate Indices

  • Read cash flow data of a sample dataset of portfolios (cost & investments)

  • Transform and clean the data

  • Enrich the data with additional information like the discount rate

  • For investment portfolio calculate the right return rate index

    • IRR for monthly investments

  • Change the names of the index result columns to homogenize the results into a single column for comparison purposes

  • Use a Bar Chart to visualize and compare the return rate index

Read

  • Cash flow data of several projects

  • Discount rates

Compute the Return Rate

  • Compute the Return Rate

  • Renaming to consolidate a single column for the return rate

Visualize the results

Check which project is the one worth investing in by ranking the different net present values

Data Pre-processing
return_rate
Column Renamer
monthly investments
Internal Rate of Return (IRR)
return rates rankingfor each project
Bar Chart
Monthly investments data
Read Excel Sheet Names
Reading & organizing the data from .xls sheets into tablesAdding discount rate info
Data cleaning

Nodes

Extensions

Links

Download

To use this workflow in KNIME, download it from the below URL and open it in KNIME:

Download Workflow
Created by: CRA
Created at: 2022-11-17
On NodePit since: 2025-10-21
Last update: 2025-10-22
Created with KNIME version: v5.8.0
Tags: InvestmentPortfolioReturn RateComponentIRRXIRRMIRRKNIME for FinanceFP&A

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