Zerodha Returns: How to Calculate Your Actual Portfolio Performance

Zerodha's tax P&L report lists realized short-term and long-term gains from closed positions. This is useful for filing taxes, but it answers a different question from investment performance. It doesn't include unrealized gains on open positions, it doesn't account for the timing of your deposits, and it ignores the opportunity cost of cash sitting idle in your account.

An investor who realized ₹2 lakh in gains on paper looks good — but if ₹20 lakh was deployed the entire time, the picture is very different from one where only ₹3 lakh was at work.

Indian equity markets have had dramatic bull and bear cycles — 2017–2018, 2020 (COVID crash and recovery), and 2021–2022. The timing of your SIP contributions, lump-sum deployments, and withdrawals relative to these cycles determines your actual return far more than the stocks you chose.

XIRR is the only metric that captures this precisely. It is also the method mandated by SEBI for reporting mutual fund returns — for good reason.

There are two primary data sources. The Tradebook CSV (available from Console → Reports → Tradebook) contains every buy and sell transaction with exact dates and amounts — this is the cleanest input for XIRR analysis of your equity portfolio.

For cash flows (deposits and withdrawals), the Ledger export (Console → Reports → Ledger) contains your pay-in and pay-out records. XIRR Auditor supports both formats and can parse them separately or together.

Your XIRR from Zerodha data reflects the annualized return on all capital you deployed into Indian equities, accounting for exact deposit timing. Compare it against the NIFTY 50 or SENSEX return over the same period for a fair benchmark.

For many retail investors on Zerodha, this comparison is humbling — active stock selection in Indian markets has historically underperformed a simple index fund after accounting for transaction costs and suboptimal timing. Your XIRR gives you the honest answer.