MCSMX vs. KWEB

Last updated Jun 3, 2026

MCSMX (Matthews China Small Companies Fund) and KWEB (KraneShares CSI China Internet ETF) are both China Equities funds. Over the past 10 years, MCSMX returned 13.62%/yr vs 0.42%/yr for KWEB. A 0.66 correlation means they provide meaningful diversification when combined. MCSMX charges 1.41%/yr vs 0.76%/yr for KWEB.

Performance

MCSMX vs. KWEB - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Matthews China Small Companies Fund (MCSMX) and KraneShares CSI China Internet ETF (KWEB). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, MCSMX achieves a 39.95% return, which is significantly higher than KWEB's -16.80% return. Over the past 10 years, MCSMX has outperformed KWEB with an annualized return of 13.62%, while KWEB has yielded a comparatively lower 0.42% annualized return.

MCSMX

• 1D: -1.54%
• 1M: 9.28%
• YTD: 39.95%
• 6M: 41.63%
• 1Y: 71.62%
• 3Y*: 20.43%
• 5Y*: 0.81%
• 10Y*: 13.62%

KWEB

• 1D: 3.55%
• 1M: -1.56%
• YTD: -16.80%
• 6M: -20.06%
• 1Y: -9.36%
• 3Y*: 5.45%
• 5Y*: -13.45%
• 10Y*: 0.42%

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

MCSMX vs. KWEB - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
MCSMX Matthews China Small Companies Fund	39.95%	28.85%	2.82%	-17.50%	-31.25%	6.71%	82.73%	35.41%	-17.65%	53.71%
KWEB KraneShares CSI China Internet ETF	-16.80%	23.55%	12.01%	-9.06%	-17.24%	-49.01%	58.23%	29.92%	-33.80%	69.73%

Correlation

The correlation between MCSMX and KWEB 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	0.68
Correlation (5Y) Calculated over the trailing 5-year period	0.68
Correlation (10Y) Calculated over the trailing 10-year period	0.67
Correlation (All Time) Calculated using the full available price history since Aug 2, 2013	0.66

The correlation between MCSMX and KWEB shifts across timeframes, from 0.49 (1 year) to 0.68 (3 years), reflecting how their relationship changes across market environments.

Return for Risk

MCSMX vs. KWEB — Risk / Return Rank

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

MCSMX

MCSMX Risk / Return Rank: 91
MCSMX Sharpe Ratio Rank: 96
MCSMX Sortino Ratio Rank: 90
MCSMX Omega Ratio Rank: 85
MCSMX Calmar Ratio Rank: 95
MCSMX Martin Ratio Rank: 87

KWEB

KWEB Risk / Return Rank: 6
KWEB Sharpe Ratio Rank: 5
KWEB Sortino Ratio Rank: 5
KWEB Omega Ratio Rank: 5
KWEB Calmar Ratio Rank: 6
KWEB Martin Ratio Rank: 6

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. KWEB - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Matthews China Small Companies Fund (MCSMX) and KraneShares CSI China Internet ETF (KWEB). 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.

	MCSMX	KWEB	Difference
Sharpe ratio Return per unit of total volatility	3.41	-0.35	+3.76
Sortino ratio Return per unit of downside risk	4.39	-0.33	+4.72
Omega ratio Gain probability vs. loss probability	1.58	0.96	+0.62
Calmar ratio Return relative to maximum drawdown	5.65	-0.24	+5.89
Martin ratio Return relative to average drawdown	16.96	-0.49	+17.45
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

MCSMX vs. KWEB - Sharpe Ratio Comparison

The current MCSMX Sharpe Ratio is 3.41, which is higher than the KWEB Sharpe Ratio of -0.35. The chart below compares the historical Sharpe Ratios of MCSMX and KWEB, 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

	MCSMX	KWEB	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	3.41	-0.35	+3.76
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.03	-0.28	+0.32
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.61	0.01	+0.60
Sharpe Ratio (All Time) Calculated using the full available price history	0.41	0.07	+0.35

Drawdowns

MCSMX vs. KWEB - Drawdown Comparison

The maximum MCSMX drawdown since its inception was -55.77%, smaller than the maximum KWEB drawdown of -80.92%. Use the drawdown chart below to compare losses from any high point for MCSMX and KWEB.

Drawdown Indicators

	MCSMX	KWEB	Difference
Max Drawdown Largest peak-to-trough decline	-55.77%	-80.92%	+25.15%
Max Drawdown (1Y) Largest decline over 1 year	-12.32%	-34.13%	+21.81%
Max Drawdown (3Y) Largest decline over 3 years	-26.50%	-34.13%	+7.63%
Max Drawdown (5Y) Largest decline over 5 years	-53.98%	-72.17%	+18.19%
Max Drawdown (10Y) Largest decline over 10 years	-55.77%	-80.92%	+25.15%
Current Drawdown Current decline from peak	-5.05%	-67.23%	+62.18%
Average Drawdown Average peak-to-trough decline	-20.22%	-35.23%	+15.01%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.11%	16.72%	-12.61%

Volatility

MCSMX vs. KWEB - Volatility Comparison

The current volatility for Matthews China Small Companies Fund (MCSMX) is 8.96%, while KraneShares CSI China Internet ETF (KWEB) has a volatility of 10.84%. This indicates that MCSMX experiences smaller price fluctuations and is considered to be less risky than KWEB based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	MCSMX	KWEB	Difference
Volatility (1M) Calculated over the trailing 1-month period	8.96%	10.84%	-1.88%
Volatility (6M) Calculated over the trailing 6-month period	17.97%	19.79%	-1.82%
Volatility (1Y) Calculated over the trailing 1-year period	21.99%	27.00%	-5.01%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	24.44%	47.66%	-23.22%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.31%	39.98%	-17.67%

MCSMX vs. KWEB - Expense Ratio Comparison

MCSMX has a 1.41% expense ratio, which is higher than KWEB's 0.76% expense ratio.

Dividends

MCSMX vs. KWEB - Dividend Comparison

MCSMX's dividend yield for the trailing twelve months is around 1.59%, less than KWEB's 7.40% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
KWEB KraneShares CSI China Internet ETF	7.40%	6.16%	3.51%	1.71%	0.00%	7.07%	0.29%	0.08%	3.40%	0.58%	1.19%	0.46%
MCSMX Matthews China Small Companies Fund	1.59%	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 KWEB in my portfolio?

MCSMX and KWEB 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 KWEB?

KWEB has higher volatility (10.84%) compared to MCSMX (8.96%). In terms of maximum drawdown, MCSMX dropped -55.77% vs KWEB's -80.92%.

Which has better risk-adjusted returns?

MCSMX currently has the higher Sharpe Ratio (3.41 vs -0.35), 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.