ESN vs. RAFE

Last updated Jun 26, 2026

ESN (Essential 40 Stock ETF) and RAFE (PIMCO RAFI ESG U.S. ETF) are both Large Cap Blend Equities funds - ESN tracks the Essential 40 Stock Index while RAFE tracks the RAFI ESG US Index. Both are passively managed. Over the past year, ESN returned 24.85% vs 29.28% for RAFE. Their correlation of 0.88 suggests significant overlap in exposure. ESN charges 0.70%/yr vs 0.30%/yr for RAFE.

Performance

ESN vs. RAFE - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Essential 40 Stock ETF (ESN) and PIMCO RAFI ESG U.S. ETF (RAFE). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

The year-to-date returns for both investments are quite close, with ESN having a 13.63% return and RAFE slightly higher at 14.01%.

ESN

• 1D: 0.13%
• 1M: -0.57%
• YTD: 13.63%
• 6M: 12.82%
• 1Y: 24.85%
• 3Y*: —
• 5Y*: —
• 10Y*: —

RAFE

• 1D: 0.45%
• 1M: 2.36%
• YTD: 14.01%
• 6M: 12.80%
• 1Y: 29.28%
• 3Y*: 19.26%
• 5Y*: 11.23%
• 10Y*: —

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

ESN vs. RAFE - Yearly Performance Comparison

	2026 (YTD)	2025	2024
ESN Essential 40 Stock ETF	13.63%	16.52%	-3.53%
RAFE PIMCO RAFI ESG U.S. ETF	14.01%	17.60%	-2.62%

Correlation

The correlation between ESN and RAFE is 0.84, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.84
Correlation (All Time) Calculated using the full available price history since Oct 21, 2024	0.88

The correlation between ESN and RAFE has been stable across timeframes, ranging from 0.84 to 0.88 - a consistent structural relationship.

Return for Risk

ESN vs. RAFE — Risk / Return Rank

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

ESN

ESN Risk / Return Rank: 85
ESN Sharpe Ratio Rank: 88
ESN Sortino Ratio Rank: 88
ESN Omega Ratio Rank: 83
ESN Calmar Ratio Rank: 82
ESN Martin Ratio Rank: 84

RAFE

RAFE Risk / Return Rank: 86
RAFE Sharpe Ratio Rank: 89
RAFE Sortino Ratio Rank: 89
RAFE Omega Ratio Rank: 86
RAFE Calmar Ratio Rank: 83
RAFE Martin Ratio Rank: 84

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.

ESN vs. RAFE - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Essential 40 Stock ETF (ESN) and PIMCO RAFI ESG U.S. ETF (RAFE). 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.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

	ESN	RAFE	Difference
Sharpe ratio: Return per unit of total volatility	2.52	2.57	-0.05
Sortino ratio: Return per unit of downside risk	3.49	3.57	-0.08
Omega ratio: Gain probability vs. loss probability	1.43	1.46	-0.02
Calmar ratio: Return relative to maximum drawdown	3.89	3.94	-0.06
Martin ratio: Return relative to average drawdown	15.16	15.24	-0.08

ESN vs. RAFE - Sharpe Ratio Comparison

The current ESN Sharpe Ratio is 2.52, which is comparable to the RAFE Sharpe Ratio of 2.57. The chart below compares the historical Sharpe Ratios of ESN and RAFE, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

ESN vs. RAFE - Drawdown Comparison

The maximum ESN drawdown since its inception was -13.60%, smaller than the maximum RAFE drawdown of -35.74%. Use the drawdown chart below to compare losses from any high point for ESN and RAFE.

Drawdown Indicators

	ESN	RAFE	Difference
Max Drawdown Largest peak-to-trough decline	-13.60%	-35.74%	+22.14%
Max Drawdown (1Y) Largest decline over 1 year	-6.42%	-7.46%	+1.04%
Max Drawdown (3Y) Largest decline over 3 years	—	-16.36%	—
Max Drawdown (5Y) Largest decline over 5 years	—	-24.28%	—
Current Drawdown Current decline from peak	-1.96%	-0.76%	-1.20%
Average Drawdown Average peak-to-trough decline	-1.86%	-6.17%	+4.31%
Ulcer Index Depth and duration of drawdowns from previous peaks	1.64%	1.93%	-0.29%

Volatility

ESN vs. RAFE - Volatility Comparison

The current volatility for Essential 40 Stock ETF (ESN) is 3.17%, while PIMCO RAFI ESG U.S. ETF (RAFE) has a volatility of 3.72%. This indicates that ESN experiences smaller price fluctuations and is considered to be less risky than RAFE based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	ESN	RAFE	Difference
Volatility (1M) Calculated over the trailing 1-month period	3.17%	3.72%	-0.55%
Volatility (6M) Calculated over the trailing 6-month period	7.45%	8.70%	-1.25%
Volatility (1Y) Calculated over the trailing 1-year period	9.96%	11.46%	-1.50%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	13.25%	15.09%	-1.84%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	13.25%	19.38%	-6.13%

ESN vs. RAFE - Expense Ratio Comparison

ESN has a 0.70% expense ratio, which is higher than RAFE's 0.30% expense ratio.

Dividends

ESN vs. RAFE - Dividend Comparison

ESN's dividend yield for the trailing twelve months is around 0.80%, less than RAFE's 1.49% yield.

Position	TTM	2025	2024	2023	2022	2021	2020
ESN Essential 40 Stock ETF	0.80%	0.91%	0.76%	0.00%	0.00%	0.00%	0.00%
RAFE PIMCO RAFI ESG U.S. ETF	1.49%	1.67%	1.79%	1.81%	2.22%	1.42%	2.36%

Frequently Asked Questions

Can I hold both ESN and RAFE in my portfolio?

ESN and RAFE have a correlation of 0.84, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, ESN or RAFE?

RAFE has higher volatility (3.72%) compared to ESN (3.17%). In terms of maximum drawdown, ESN dropped -13.60% vs RAFE's -35.74%.

Which ETF is better, ESN or RAFE?

On 1-year performance, RAFE leads with 29.28% vs 24.85% for ESN. On fees, RAFE is cheaper at 0.30% per year. On volatility, ESN has been the lower-risk option at 3.17%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, ESN or RAFE?

Over the 1-year period, RAFE has performed better with a 29.28% return vs 24.85%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, ESN or RAFE?

RAFE is cheaper with a 0.30% expense ratio, compared with 0.70% for ESN.

Which ETF pays a higher dividend yield, ESN or RAFE?

RAFE has the higher dividend yield at 1.49%, compared with 0.80% for ESN.

What is the main difference between ESN and RAFE?

ESN tracks Essential 40 Stock Index, while RAFE tracks RAFI ESG US Index. They also come from different issuers: KKM Financial and PIMCO. Their fees differ too: 0.70% for ESN and 0.30% for RAFE.

Which has better risk-adjusted returns?

RAFE currently has the higher Sharpe Ratio (2.57 vs 2.52), 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.