EDC vs. EEM

Last updated Jun 6, 2026

EDC (Direxion Daily Emerging Markets Bull 3X Shares) and EEM (iShares MSCI Emerging Markets ETF) are both exchange-traded funds - EDC is a Leveraged Equities fund tracking the MSCI Emerging Markets Index (300%), while EEM is a Emerging Markets Diversified fund tracking the MSCI Emerging Markets Index (Net). Both are passively managed. Over the past 10 years, EDC returned 5.33%/yr vs 8.84%/yr for EEM. With a 1.00 correlation, they move nearly in lockstep. EDC charges 1.33%/yr vs 0.72%/yr for EEM.

Performance

EDC vs. EEM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Direxion Daily Emerging Markets Bull 3X Shares (EDC) and iShares MSCI Emerging Markets ETF (EEM). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, EDC achieves a 41.26% return, which is significantly higher than EEM's 18.06% return. Over the past 10 years, EDC has underperformed EEM with an annualized return of 5.33%, while EEM has yielded a comparatively higher 8.84% annualized return.

EDC

• 1D: -19.64%
• 1M: -16.09%
• YTD: 41.26%
• 6M: 46.07%
• 1Y: 121.30%
• 3Y*: 39.05%
• 5Y*: -5.24%
• 10Y*: 5.33%

EEM

• 1D: -6.53%
• 1M: -4.30%
• YTD: 18.06%
• 6M: 19.68%
• 1Y: 41.43%
• 3Y*: 20.37%
• 5Y*: 5.33%
• 10Y*: 8.84%

*Multi-year figures are annualized to reflect compound growth (CAGR)

EDC vs. EEM - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
EDC Direxion Daily Emerging Markets Bull 3X Shares	41.26%	94.58%	-2.00%	7.48%	-60.25%	-20.81%	6.49%	43.92%	-49.87%	138.61%
EEM iShares MSCI Emerging Markets ETF	18.06%	33.98%	6.49%	8.95%	-20.56%	-3.63%	17.02%	18.22%	-15.31%	37.26%

Correlation

The correlation between EDC and EEM is 1.00 - these two move nearly in lockstep. At this level, holding both provides almost no diversification benefit. If you already own one, adding the other does little to reduce portfolio risk.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	1.00
Correlation (3Y) Calculated over the trailing 3-year period	1.00
Correlation (5Y) Calculated over the trailing 5-year period	1.00
Correlation (10Y) Calculated over the trailing 10-year period	1.00
Correlation (All Time) Calculated using the full available price history since Dec 31, 2008	1.00

The correlation between EDC and EEM has been stable across timeframes, ranging from 1.00 to 1.00 - a consistent structural relationship.

EDC vs. EEM - Sectors Allocation Comparison

Sectors	EDC	EEM
Technology	32.7%	43.6%
Financial Services	20.8%	17.5%
Consumer Cyclical	10.3%	8.1%
Communication Services	7.8%	5.7%
Industrials	7.3%	6.2%
Basic Materials	7.0%	6.1%
Energy	4.4%	3.3%
Consumer Defensive	3.2%	2.7%
Healthcare	3.2%	2.5%
Utilities	2.2%	2.0%
Real Estate	1.1%	0.9%

Return for Risk

EDC vs. EEM — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

EDC

EDC Risk / Return Rank: 59
EDC Sharpe Ratio Rank: 60
EDC Sortino Ratio Rank: 49
EDC Omega Ratio Rank: 56
EDC Calmar Ratio Rank: 67
EDC Martin Ratio Rank: 64

EEM

EEM Risk / Return Rank: 61
EEM Sharpe Ratio Rank: 60
EEM Sortino Ratio Rank: 54
EEM Omega Ratio Rank: 63
EEM Calmar Ratio Rank: 63
EEM Martin Ratio Rank: 65

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

EDC vs. EEM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Direxion Daily Emerging Markets Bull 3X Shares (EDC) and iShares MSCI Emerging Markets ETF (EEM). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

	EDC	EEM	Difference
Sharpe ratio: Return per unit of total volatility	1.94	1.97	-0.04
Sortino ratio: Return per unit of downside risk	2.30	2.56	-0.26
Omega ratio: Gain probability vs. loss probability	1.33	1.38	-0.04
Calmar ratio: Return relative to maximum drawdown	3.21	3.08	+0.13
Martin ratio: Return relative to average drawdown	11.18	11.71	-0.54
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

EDC vs. EEM - Sharpe Ratio Comparison

The current EDC Sharpe Ratio is 1.94, which is comparable to the EEM Sharpe Ratio of 1.97. The chart below compares the historical Sharpe Ratios of EDC and EEM, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	EDC	EEM	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.94	1.97	-0.04
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	-0.09	0.28	-0.37
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.09	0.43	-0.34
Sharpe Ratio (All Time) Calculated using the full available price history	0.02	0.37	-0.34

Drawdowns

EDC vs. EEM - Drawdown Comparison

The maximum EDC drawdown since its inception was -92.54%, which is greater than EEM's maximum drawdown of -66.43%. Use the drawdown chart below to compare losses from any high point for EDC and EEM.

Drawdown Indicators

	EDC	EEM	Difference
Max Drawdown Largest peak-to-trough decline	-92.54%	-66.43%	-26.11%
Max Drawdown (1Y) Largest decline over 1 year	-37.98%	-13.52%	-24.46%
Max Drawdown (3Y) Largest decline over 3 years	-49.48%	-17.29%	-32.19%
Max Drawdown (5Y) Largest decline over 5 years	-80.70%	-37.49%	-43.21%
Max Drawdown (10Y) Largest decline over 10 years	-87.01%	-39.82%	-47.19%
Current Drawdown Current decline from peak	-70.02%	-8.77%	-61.25%
Average Drawdown Average peak-to-trough decline	-65.36%	-16.02%	-49.34%
Ulcer Index Depth and duration of drawdowns from previous peaks	10.90%	3.55%	+7.35%

Volatility

EDC vs. EEM - Volatility Comparison

Direxion Daily Emerging Markets Bull 3X Shares (EDC) has a higher volatility of 32.64% compared to iShares MSCI Emerging Markets ETF (EEM) at 10.49%. This indicates that EDC's price experiences larger fluctuations and is considered to be riskier than EEM based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	EDC	EEM	Difference
Volatility (1M) Calculated over the trailing 1-month period	32.64%	10.49%	+22.15%
Volatility (6M) Calculated over the trailing 6-month period	56.70%	18.80%	+37.90%
Volatility (1Y) Calculated over the trailing 1-year period	63.00%	21.09%	+41.91%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	57.35%	19.14%	+38.21%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	61.01%	20.61%	+40.40%

EDC vs. EEM - Expense Ratio Comparison

EDC has a 1.33% expense ratio, which is higher than EEM's 0.72% expense ratio.

Dividends

EDC vs. EEM - Dividend Comparison

EDC's dividend yield for the trailing twelve months is around 1.21%, less than EEM's 1.88% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
EDC Direxion Daily Emerging Markets Bull 3X Shares	1.21%	1.79%	3.94%	3.54%	0.00%	0.18%	0.44%	0.97%	0.78%	0.25%	0.00%	0.00%
EEM iShares MSCI Emerging Markets ETF	1.88%	2.22%	2.43%	2.63%	2.50%	1.99%	1.45%	2.76%	2.24%	1.89%	1.89%	2.49%

Frequently Asked Questions

Can I hold both EDC and EEM in my portfolio?

With a correlation of 1.00, EDC and EEM move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.

Which is riskier, EDC or EEM?

EDC has higher volatility (32.64%) compared to EEM (10.49%). In terms of maximum drawdown, EDC dropped -92.54% vs EEM's -66.43%.

Which ETF is better, EDC or EEM?

On 10-year performance, EEM leads with 8.84% vs 5.33% for EDC. On fees, EEM is cheaper at 0.72% per year. On volatility, EEM has been the lower-risk option at 10.49%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, EDC or EEM?

Over the 10-year period, EEM has performed better with a 8.84% return vs 5.33%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, EDC or EEM?

EEM is cheaper with a 0.72% expense ratio, compared with 1.33% for EDC.

Which ETF pays a higher dividend yield, EDC or EEM?

EEM has the higher dividend yield at 1.88%, compared with 1.21% for EDC.

What is the main difference between EDC and EEM?

EDC is categorized as Leveraged Equities, while EEM is Emerging Markets Diversified. EDC tracks MSCI Emerging Markets Index (300%), while EEM tracks MSCI Emerging Markets Index (Net). They also come from different issuers: Direxion and iShares. Their fees differ too: 1.33% for EDC and 0.72% for EEM.

Which has better risk-adjusted returns?

EEM currently has the higher Sharpe Ratio (1.97 vs 1.94), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.