MSD vs VXUS
MSD vs VXUS
Morgan Stanley Emerging Markets Debt Fund Inc. vs Vanguard Total International Stock ETF
Quick Verdict
VXUS has a lower expense ratio. VXUS delivered stronger 1-year returns. VXUS offers more diversification with 7860 holdings.
Side-by-Side Comparison
| Metric | MSD | VXUS | Winner |
|---|---|---|---|
| Expense Ratio | 1.19% | 0.05% | |
| AUM | - | $156.5B | |
| Dividend Yield | 7.66% | 2.60% | |
| Holdings | 358 | 8,747 | |
| YTD Return | +3.06% | +11.69% | |
| 1Y Return | +6.82% | +26.65% | |
| 3Y Return (annualized) | +15.53% | +18.15% | |
| 5Y Return (annualized) | +4.05% | +8.66% | |
| Volatility (annualized) | 18.4% | 15.0% | |
| Max Drawdown | -66.0% | -39.9% | |
| Fund Family | Morgan Stanley Investment Management | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Jul 23, 1993 | Jan 26, 2011 |
MSD vs VXUS Performance
Morgan Stanley Emerging Markets Debt Fund Inc. (MSD) is a ETF from Morgan Stanley Investment Management and Vanguard Total International Stock ETF (VXUS) is a ETF from Vanguard (US). Over the past year MSD returned +6.82% while VXUS returned +26.65%. Year to date, MSD is up 3.06% versus a gain of 11.69% for VXUS.
Over three years, MSD compounded at +15.53% per year against +18.15% for VXUS; over five years the annualized figures are +4.05% and +8.66% respectively. Across the full 16-year window we track, VXUS has the edge at +4.69% 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 15.0% for VXUS. 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 -39.9% for VXUS. 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 0.74. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
MSD charges 1.19% per year while VXUS charges 0.05%. On a $10,000 position that is $119 vs $5 annually, a gap of $114 per year that compounds over a long holding period. On income, MSD currently yields 7.66% against 2.60% for VXUS.
Holdings Overlap
MSD and VXUS share 3 holdings out of 7910 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in MSD | Weight in VXUS | Difference |
|---|---|---|---|
| ARGENT 4.125 07/09/3 | 0.46% | 0.00% | 0.46% |
| ARGENT 5 01/09/38 | 0.14% | 0.00% | 0.14% |
| ARGENT 3.5 07/09/41 | 0.13% | 0.00% | 0.13% |
Frequently Asked Questions
Which is cheaper, MSD or VXUS?
MSD has an expense ratio of 1.19% while VXUS charges 0.05%. VXUS is the cheaper option. On a $10,000 investment, that is $114 per year of difference.
Which performed better, MSD or VXUS?
Over the past year MSD returned +6.82% vs +26.65% for VXUS, so VXUS leads on 1-year performance. Over the longest common window we track (16 years), MSD annualized -0.26% vs +4.69% for VXUS. Past performance does not guarantee future results.
Which is riskier, MSD or VXUS?
MSD has been the more volatile fund at 18.4% annualized versus 15.0% for VXUS. Worst drawdown: MSD -66.0% vs VXUS -39.9%.
Should I hold both MSD and VXUS?
MSD and VXUS have a monthly-return correlation of 0.74, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between MSD and VXUS?
MSD and VXUS share 3 common holdings with a 0.0% weight overlap. Combined, they hold 7910 unique securities.
Which pays a higher dividend, MSD or VXUS?
MSD yields 7.66% while VXUS yields 2.60%, so MSD currently pays the higher dividend yield.
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