LDEM vs. PABU

Last updated Jun 16, 2026

LDEM (iShares ESG MSCI EM Leaders ETF) and PABU (iShares Paris-Aligned Climate Optimized MSCI USA ETF) are both exchange-traded funds - LDEM is a Emerging Markets Equities fund tracking the MSCI EM Extended ESG Leaders 5% Issuer Capped Index, while PABU is a Large Cap Blend Equities fund tracking the MSCI USA Climate Paris Aligned Benchmark Extended Select PAB Index (USD). Both are passively managed. Over the past 3 years, LDEM returned 13.85%/yr vs 18.02%/yr for PABU. A 0.57 correlation means they provide meaningful diversification when combined. LDEM charges 0.16%/yr vs 0.10%/yr for PABU.

Performance

LDEM vs. PABU - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares ESG MSCI EM Leaders ETF (LDEM) and iShares Paris-Aligned Climate Optimized MSCI USA ETF (PABU). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, LDEM achieves a 8.26% return, which is significantly higher than PABU's 6.81% return.

LDEM

• 1D: 2.52%
• 1M: 3.00%
• YTD: 8.26%
• 6M: 9.66%
• 1Y: 24.07%
• 3Y*: 13.85%
• 5Y*: 2.60%
• 10Y*: —

PABU

• 1D: 1.98%
• 1M: 1.91%
• YTD: 6.81%
• 6M: 7.83%
• 1Y: 20.95%
• 3Y*: 18.02%
• 5Y*: —
• 10Y*: —

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

LDEM vs. PABU - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022
LDEM iShares ESG MSCI EM Leaders ETF	8.26%	32.49%	5.87%	6.49%	-24.00%
PABU iShares Paris-Aligned Climate Optimized MSCI USA ETF	6.81%	13.08%	24.84%	29.51%	-15.45%

Correlation

The correlation between LDEM and PABU is 0.67, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.67
Correlation (3Y) Calculated over the trailing 3-year period	0.57
Correlation (All Time) Calculated using the full available price history since Feb 11, 2022	0.57

The correlation between LDEM and PABU shifts across timeframes, from 0.57 (all time) to 0.67 (1 year), reflecting how their relationship changes across market environments.

LDEM vs. PABU - Sectors Allocation Comparison

Sectors	LDEM	PABU
Technology	25.9%	52.1%
Financial Services	24.7%	6.8%
Consumer Cyclical	12.6%	6.0%
Communication Services	10.6%	8.4%
Basic Materials	6.4%	0.5%
Industrials	5.5%	1.6%
Energy	4.2%	0.9%
Consumer Defensive	2.9%	-
Healthcare	2.6%	5.7%
Utilities	1.9%	1.6%
Real Estate	1.4%	16.6%

Return for Risk

LDEM vs. PABU — Risk / Return Rank

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

LDEM

LDEM Risk / Return Rank: 39
LDEM Sharpe Ratio Rank: 38
LDEM Sortino Ratio Rank: 37
LDEM Omega Ratio Rank: 40
LDEM Calmar Ratio Rank: 39
LDEM Martin Ratio Rank: 39

PABU

PABU Risk / Return Rank: 40
PABU Sharpe Ratio Rank: 45
PABU Sortino Ratio Rank: 43
PABU Omega Ratio Rank: 44
PABU Calmar Ratio Rank: 33
PABU Martin Ratio Rank: 37

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.

LDEM vs. PABU - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares ESG MSCI EM Leaders ETF (LDEM) and iShares Paris-Aligned Climate Optimized MSCI USA ETF (PABU). 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.

	LDEM	PABU	Difference
Sharpe ratio: Return per unit of total volatility	1.28	1.50	-0.22
Sortino ratio: Return per unit of downside risk	1.81	2.05	-0.24
Omega ratio: Gain probability vs. loss probability	1.25	1.27	-0.02
Calmar ratio: Return relative to maximum drawdown	1.83	1.57	+0.26
Martin ratio: Return relative to average drawdown	5.76	5.37	+0.39

LDEM vs. PABU - Sharpe Ratio Comparison

The current LDEM Sharpe Ratio is 1.28, which is comparable to the PABU Sharpe Ratio of 1.50. The chart below compares the historical Sharpe Ratios of LDEM and PABU, 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

LDEM vs. PABU - Drawdown Comparison

The maximum LDEM drawdown since its inception was -40.82%, which is greater than PABU's maximum drawdown of -22.76%. Use the drawdown chart below to compare losses from any high point for LDEM and PABU.

Drawdown Indicators

	LDEM	PABU	Difference
Max Drawdown Largest peak-to-trough decline	-40.82%	-22.76%	-18.06%
Max Drawdown (1Y) Largest decline over 1 year	-13.21%	-13.40%	+0.19%
Max Drawdown (3Y) Largest decline over 3 years	-15.12%	-20.85%	+5.73%
Max Drawdown (5Y) Largest decline over 5 years	-39.17%	—	—
Current Drawdown Current decline from peak	-2.72%	-3.61%	+0.89%
Average Drawdown Average peak-to-trough decline	-17.30%	-5.62%	-11.68%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.19%	3.91%	+0.28%

Volatility

LDEM vs. PABU - Volatility Comparison

iShares ESG MSCI EM Leaders ETF (LDEM) has a higher volatility of 8.65% compared to iShares Paris-Aligned Climate Optimized MSCI USA ETF (PABU) at 5.97%. This indicates that LDEM's price experiences larger fluctuations and is considered to be riskier than PABU based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	LDEM	PABU	Difference
Volatility (1M) Calculated over the trailing 1-month period	8.65%	5.97%	+2.68%
Volatility (6M) Calculated over the trailing 6-month period	15.64%	11.32%	+4.32%
Volatility (1Y) Calculated over the trailing 1-year period	18.96%	14.06%	+4.90%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	19.34%	18.76%	+0.58%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	20.87%	18.76%	+2.11%

LDEM vs. PABU - Expense Ratio Comparison

LDEM has a 0.16% expense ratio, which is higher than PABU's 0.10% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

LDEM vs. PABU - Dividend Comparison

LDEM's dividend yield for the trailing twelve months is around 3.83%, more than PABU's 1.09% yield.

Position	TTM	2025	2024	2023	2022	2021	2020
LDEM iShares ESG MSCI EM Leaders ETF	3.83%	3.26%	2.64%	3.20%	4.93%	1.82%	1.89%
PABU iShares Paris-Aligned Climate Optimized MSCI USA ETF	1.09%	0.90%	1.00%	1.06%	1.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both LDEM and PABU in my portfolio?

LDEM and PABU have a correlation of 0.67, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, LDEM or PABU?

LDEM has higher volatility (8.65%) compared to PABU (5.97%). In terms of maximum drawdown, LDEM dropped -40.82% vs PABU's -22.76%.

Which ETF is better, LDEM or PABU?

On 3-year performance, PABU leads with 18.02% vs 13.85% for LDEM. On fees, PABU is cheaper at 0.10% per year. On volatility, PABU has been the lower-risk option at 5.97%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, LDEM or PABU?

Over the 3-year period, PABU has performed better with a 18.02% return vs 13.85%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, LDEM or PABU?

PABU is cheaper with a 0.10% expense ratio, compared with 0.16% for LDEM.

Which ETF pays a higher dividend yield, LDEM or PABU?

LDEM has the higher dividend yield at 3.83%, compared with 1.09% for PABU.

What is the main difference between LDEM and PABU?

LDEM is categorized as Emerging Markets Equities, while PABU is Large Cap Blend Equities. LDEM tracks MSCI EM Extended ESG Leaders 5% Issuer Capped Index, while PABU tracks MSCI USA Climate Paris Aligned Benchmark Extended Select PAB Index (USD). Their fees differ too: 0.16% for LDEM and 0.10% for PABU.

Which has better risk-adjusted returns?

PABU currently has the higher Sharpe Ratio (1.50 vs 1.28), 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.