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Exclude zero polynomial roots from IRR solutions #172

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Exclude zero polynomial roots from IRR solutions #172

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4 changes: 2 additions & 2 deletions numpy_financial/_financial.py
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Original file line number Diff line number Diff line change
Expand Up @@ -1153,8 +1153,8 @@ def irr(values, *, raise_exceptions=False, selection_logic=_irr_default_selectio
g = np.roots(row)
eirr = np.real(g[np.isreal(g)]) - 1

# Realistic IRR
eirr = eirr[eirr >= -1]
# The discount factor must be nonzero in the NPV equation.
eirr = eirr[eirr > -1]

# If no real solution
if len(eirr) == 0:
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12 changes: 12 additions & 0 deletions numpy_financial/tests/test_financial.py
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Original file line number Diff line number Diff line change
Expand Up @@ -796,6 +796,18 @@ def test_numpy_gh_6744(self, v):
# Test that if there is no solution then npf.irr returns nan.
assert numpy.isnan(npf.irr(v))

@pytest.mark.parametrize("cashflows", [
[100, 50, 0], [-100, -50, 0], [0, 100, 0], [0, -100, 0],
])
def test_zero_polynomial_root_is_not_an_irr(self, cashflows):
assert numpy.isnan(npf.irr(cashflows))
with pytest.raises(npf.NoRealSolutionError):
npf.irr(cashflows, raise_exceptions=True)

def test_trailing_zeros_preserve_negative_irr(self):
assert_allclose(npf.irr([-100, 50, 0, 0]), -0.5)
assert_allclose(npf.irr([[-100, 50, 0], [-100, 150, 0]]), [-0.5, 0.5])

def test_gh_15(self):
v = [
-3000.0,
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