MCSMX vs. CAF

Last updated Jun 23, 2026

MCSMX (Matthews China Small Companies Fund) and CAF (Morgan Stanley China A Share Fund) are both China Equities funds. Over the past 10 years, MCSMX returned 15.01%/yr vs 6.45%/yr for CAF. A 0.58 correlation means they provide meaningful diversification when combined. MCSMX charges 1.41%/yr vs 1.67%/yr for CAF.

Performance

MCSMX vs. CAF - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Matthews China Small Companies Fund (MCSMX) and Morgan Stanley China A Share Fund (CAF). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, MCSMX achieves a 53.58% return, which is significantly higher than CAF's 17.11% return. Over the past 10 years, MCSMX has outperformed CAF with an annualized return of 15.01%, while CAF has yielded a comparatively lower 6.45% annualized return.

MCSMX

• 1D: 3.72%
• 1M: 9.06%
• YTD: 53.58%
• 6M: 52.25%
• 1Y: 85.81%
• 3Y*: 22.20%
• 5Y*: 3.08%
• 10Y*: 15.01%

CAF

• 1D: 2.47%
• 1M: 2.94%
• YTD: 17.11%
• 6M: 17.24%
• 1Y: 55.60%
• 3Y*: 19.43%
• 5Y*: 0.23%
• 10Y*: 6.45%

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

MCSMX vs. CAF - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
MCSMX Matthews China Small Companies Fund	53.58%	28.85%	2.82%	-17.50%	-31.25%	6.71%	82.73%	35.41%	-17.65%	53.71%
CAF Morgan Stanley China A Share Fund	17.11%	41.51%	0.34%	-9.39%	-30.41%	-1.77%	12.74%	23.50%	-14.26%	44.94%

Correlation

The correlation between MCSMX and CAF is 0.49, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.49
Correlation (3Y) Calculated over the trailing 3-year period	0.59
Correlation (5Y) Calculated over the trailing 5-year period	0.65
Correlation (10Y) Calculated over the trailing 10-year period	0.61
Correlation (All Time) Calculated using the full available price history since Jun 2, 2011	0.58

The correlation between MCSMX and CAF shifts across timeframes, from 0.49 (1 year) to 0.65 (5 years), reflecting how their relationship changes across market environments.

Return for Risk

MCSMX vs. CAF — Risk / Return Rank

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

MCSMX

MCSMX Risk / Return Rank: 94
MCSMX Sharpe Ratio Rank: 98
MCSMX Sortino Ratio Rank: 93
MCSMX Omega Ratio Rank: 89
MCSMX Calmar Ratio Rank: 97
MCSMX Martin Ratio Rank: 95

CAF

CAF Risk / Return Rank: 89
CAF Sharpe Ratio Rank: 93
CAF Sortino Ratio Rank: 88
CAF Omega Ratio Rank: 84
CAF Calmar Ratio Rank: 94
CAF Martin Ratio Rank: 87

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.

MCSMX vs. CAF - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Matthews China Small Companies Fund (MCSMX) and Morgan Stanley China A Share Fund (CAF). 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.

	MCSMX	CAF	Difference
Sharpe ratio: Return per unit of total volatility	3.50	2.94	+0.56
Sortino ratio: Return per unit of downside risk	4.36	3.92	+0.44
Omega ratio: Gain probability vs. loss probability	1.60	1.51	+0.08
Calmar ratio: Return relative to maximum drawdown	6.95	5.09	+1.86
Martin ratio: Return relative to average drawdown	19.94	15.47	+4.47

MCSMX vs. CAF - Sharpe Ratio Comparison

The current MCSMX Sharpe Ratio is 3.50, which is comparable to the CAF Sharpe Ratio of 2.94. The chart below compares the historical Sharpe Ratios of MCSMX and CAF, 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

MCSMX vs. CAF - Drawdown Comparison

The maximum MCSMX drawdown since its inception was -55.77%, smaller than the maximum CAF drawdown of -65.88%. Use the drawdown chart below to compare losses from any high point for MCSMX and CAF.

Drawdown Indicators

	MCSMX	CAF	Difference
Max Drawdown Largest peak-to-trough decline	-55.77%	-65.88%	+10.11%
Max Drawdown (1Y) Largest decline over 1 year	-12.32%	-10.98%	-1.34%
Max Drawdown (3Y) Largest decline over 3 years	-26.50%	-26.27%	-0.23%
Max Drawdown (5Y) Largest decline over 5 years	-53.98%	-46.98%	-7.00%
Max Drawdown (10Y) Largest decline over 10 years	-55.77%	-49.01%	-6.76%
Current Drawdown Current decline from peak	0.00%	-4.07%	+4.07%
Average Drawdown Average peak-to-trough decline	-20.16%	-25.87%	+5.71%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.26%	3.61%	+0.65%

Volatility

MCSMX vs. CAF - Volatility Comparison

Matthews China Small Companies Fund (MCSMX) has a higher volatility of 13.03% compared to Morgan Stanley China A Share Fund (CAF) at 5.76%. This indicates that MCSMX's price experiences larger fluctuations and is considered to be riskier than CAF based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	MCSMX	CAF	Difference
Volatility (1M) Calculated over the trailing 1-month period	13.03%	5.76%	+7.27%
Volatility (6M) Calculated over the trailing 6-month period	20.76%	13.73%	+7.03%
Volatility (1Y) Calculated over the trailing 1-year period	24.46%	19.02%	+5.44%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	24.88%	21.56%	+3.32%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.57%	21.91%	+0.66%

MCSMX vs. CAF - Expense Ratio Comparison

MCSMX has a 1.41% expense ratio, which is lower than CAF's 1.67% expense ratio.

Dividends

MCSMX vs. CAF - Dividend Comparison

MCSMX's dividend yield for the trailing twelve months is around 1.45%, more than CAF's 1.29% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
CAF Morgan Stanley China A Share Fund	1.29%	1.51%	2.63%	0.96%	0.02%	6.57%	10.40%	3.78%	9.48%	5.20%	4.69%	67.03%
MCSMX Matthews China Small Companies Fund	1.45%	2.23%	1.35%	2.36%	1.78%	26.38%	16.98%	1.03%	2.25%	5.66%	4.79%	8.88%

Frequently Asked Questions

Can I hold both MCSMX and CAF in my portfolio?

MCSMX and CAF have a correlation of 0.49, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, MCSMX or CAF?

MCSMX has higher volatility (13.03%) compared to CAF (5.76%). In terms of maximum drawdown, MCSMX dropped -55.77% vs CAF's -65.88%.

Which has better risk-adjusted returns?

MCSMX currently has the higher Sharpe Ratio (3.50 vs 2.94), 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.