MSD vs VTI
MSD vs VTI
Morgan Stanley Emerging Markets Debt Fund Inc. vs Vanguard Total Stock Market ETF
Quick Verdict
VTI has a lower expense ratio. VTI delivered stronger 1-year returns. VTI offers more diversification with 2783 holdings.
Side-by-Side Comparison
| Metric | MSD | VTI | Winner |
|---|---|---|---|
| Expense Ratio | 1.19% | 0.03% | |
| AUM | - | $663.5B | |
| Dividend Yield | 7.66% | 1.07% | |
| Holdings | 358 | 3,543 | |
| YTD Return | +3.06% | +11.83% | |
| 1Y Return | +6.82% | +21.79% | |
| 3Y Return (annualized) | +15.53% | +20.40% | |
| 5Y Return (annualized) | +4.05% | +11.96% | |
| Volatility (annualized) | 18.4% | 15.3% | |
| Max Drawdown | -66.0% | -56.6% | |
| Fund Family | Morgan Stanley Investment Management | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Jul 23, 1993 | May 24, 2001 |
MSD vs VTI Performance
Morgan Stanley Emerging Markets Debt Fund Inc. (MSD) is a ETF from Morgan Stanley Investment Management and Vanguard Total Stock Market ETF (VTI) is a ETF from Vanguard (US). Over the past year MSD returned +6.82% while VTI returned +21.79%. Year to date, MSD is up 3.06% versus a gain of 11.83% for VTI.
Over three years, MSD compounded at +15.53% per year against +20.40% for VTI; over five years the annualized figures are +4.05% and +11.96% respectively. Across the full 25-year window we track, VTI has the edge at +8.06% annualized vs -0.26%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
MSD has been the more volatile fund, with annualized monthly volatility of 18.4% compared with 15.3% for VTI. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -66.0% for MSD and -56.6% for VTI. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.56. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
MSD charges 1.19% per year while VTI charges 0.03%. On a $10,000 position that is $119 vs $3 annually, a gap of $116 per year that compounds over a long holding period. On income, MSD currently yields 7.66% against 1.07% for VTI.
Holdings Overlap
MSD and VTI share 0 holdings out of 2836 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, MSD or VTI?
MSD has an expense ratio of 1.19% while VTI charges 0.03%. VTI is the cheaper option. On a $10,000 investment, that is $116 per year of difference.
Which performed better, MSD or VTI?
Over the past year MSD returned +6.82% vs +21.79% for VTI, so VTI leads on 1-year performance. Over the longest common window we track (25 years), MSD annualized -0.26% vs +8.06% for VTI. Past performance does not guarantee future results.
Which is riskier, MSD or VTI?
MSD has been the more volatile fund at 18.4% annualized versus 15.3% for VTI. Worst drawdown: MSD -66.0% vs VTI -56.6%.
Should I hold both MSD and VTI?
MSD and VTI have a monthly-return correlation of 0.56, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between MSD and VTI?
MSD and VTI share 0 common holdings with a 0.0% weight overlap. Combined, they hold 2836 unique securities.
Which pays a higher dividend, MSD or VTI?
MSD yields 7.66% while VTI yields 1.07%, so MSD currently pays the higher dividend yield.
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