I've put aside 1000 EUR for trading strategy test. Made number of trades where each position was worth 5 EUR. At any moment there was invested from 0 to 80 EUR. Entered all cashflows to XIRR function and it shows 0,14. What does it mean? I suppose it means 14% return from some sum over some period. I assume the period is 1 year, but what is the sum that gives 14%? Should I somehow add funds that sit idle?
For example I bought an asset on 1st of Jan for 5 EUR and in 3 days sold it with 0,2 EUR profit. Cashflows for this trade are: