MS vs. VFH

Last updated Jun 9, 2026

MS (Morgan Stanley) is a stock, while VFH (Vanguard Financials ETF) is Financials Equities fund tracking the MSCI US Investable Market Financials 25/50 Index. Over the past 10 years, MS returned 27.13%/yr vs 12.59%/yr for VFH. A 0.79 correlation means they provide meaningful diversification when combined.

Performance

MS vs. VFH - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Morgan Stanley (MS) and Vanguard Financials ETF (VFH). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, MS achieves a 20.86% return, which is significantly higher than VFH's -4.26% return. Over the past 10 years, MS has outperformed VFH with an annualized return of 27.13%, while VFH has yielded a comparatively lower 12.59% annualized return.

MS

• 1D: 0.15%
• 1M: 9.92%
• YTD: 20.86%
• 6M: 21.34%
• 1Y: 64.89%
• 3Y*: 39.40%
• 5Y*: 21.89%
• 10Y*: 27.13%

VFH

• 1D: -0.53%
• 1M: 1.01%
• YTD: -4.26%
• 6M: -1.64%
• 1Y: 4.15%
• 3Y*: 18.86%
• 5Y*: 8.65%
• 10Y*: 12.59%

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

MS vs. VFH - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
MS Morgan Stanley	20.86%	45.16%	39.73%	13.93%	-10.34%	46.65%	38.09%	32.67%	-22.76%	26.61%
VFH Vanguard Financials ETF	-4.26%	14.91%	30.44%	14.17%	-12.31%	35.22%	-1.96%	31.57%	-13.52%	19.99%

Correlation

The correlation between MS and VFH is 0.69, 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	0.69
Correlation (3Y) Calculated over the trailing 3-year period	0.74
Correlation (5Y) Calculated over the trailing 5-year period	0.79
Correlation (10Y) Calculated over the trailing 10-year period	0.83
Correlation (All Time) Calculated using the full available price history since Jan 30, 2004	0.79

The correlation between MS and VFH shifts across timeframes, from 0.69 (1 year) to 0.83 (10 years), reflecting how their relationship changes across market environments.

Return for Risk

MS vs. VFH — Risk / Return Rank

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

MS

MS Risk / Return Rank: 90
MS Sharpe Ratio Rank: 93
MS Sortino Ratio Rank: 90
MS Omega Ratio Rank: 91
MS Calmar Ratio Rank: 86
MS Martin Ratio Rank: 90

VFH

VFH Risk / Return Rank: 13
VFH Sharpe Ratio Rank: 14
VFH Sortino Ratio Rank: 13
VFH Omega Ratio Rank: 13
VFH Calmar Ratio Rank: 13
VFH Martin Ratio Rank: 13

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.

MS vs. VFH - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Morgan Stanley (MS) and Vanguard Financials ETF (VFH). 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.

	MS	VFH	Difference
Sharpe ratio: Return per unit of total volatility	2.55	0.28	+2.27
Sortino ratio: Return per unit of downside risk	3.16	0.48	+2.68
Omega ratio: Gain probability vs. loss probability	1.43	1.06	+0.37
Calmar ratio: Return relative to maximum drawdown	3.46	0.28	+3.18
Martin ratio: Return relative to average drawdown	11.46	0.74	+10.72
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

MS vs. VFH - Sharpe Ratio Comparison

The current MS Sharpe Ratio is 2.55, which is higher than the VFH Sharpe Ratio of 0.28. The chart below compares the historical Sharpe Ratios of MS and VFH, 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

	MS	VFH	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.55	0.28	+2.27
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.77	0.45	+0.32
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.86	0.56	+0.30
Sharpe Ratio (All Time) Calculated using the full available price history	0.29	0.24	+0.05

Drawdowns

MS vs. VFH - Drawdown Comparison

The maximum MS drawdown since its inception was -88.12%, which is greater than VFH's maximum drawdown of -78.61%. Use the drawdown chart below to compare losses from any high point for MS and VFH.

Drawdown Indicators

	MS	VFH	Difference
Max Drawdown Largest peak-to-trough decline	-88.12%	-78.61%	-9.51%
Max Drawdown (1Y) Largest decline over 1 year	-18.83%	-14.75%	-4.08%
Max Drawdown (3Y) Largest decline over 3 years	-29.24%	-17.30%	-11.94%
Max Drawdown (5Y) Largest decline over 5 years	-32.38%	-25.66%	-6.72%
Max Drawdown (10Y) Largest decline over 10 years	-51.33%	-44.42%	-6.91%
Current Drawdown Current decline from peak	-2.76%	-7.17%	+4.41%
Average Drawdown Average peak-to-trough decline	-33.70%	-18.53%	-15.17%
Ulcer Index Depth and duration of drawdowns from previous peaks	5.68%	5.60%	+0.08%

Volatility

MS vs. VFH - Volatility Comparison

Morgan Stanley (MS) has a higher volatility of 8.06% compared to Vanguard Financials ETF (VFH) at 4.28%. This indicates that MS's price experiences larger fluctuations and is considered to be riskier than VFH based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	MS	VFH	Difference
Volatility (1M) Calculated over the trailing 1-month period	8.06%	4.28%	+3.78%
Volatility (6M) Calculated over the trailing 6-month period	21.21%	11.34%	+9.87%
Volatility (1Y) Calculated over the trailing 1-year period	25.62%	14.98%	+10.64%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	28.72%	19.34%	+9.38%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	31.51%	22.56%	+8.95%

Dividends

MS vs. VFH - Dividend Comparison

MS's dividend yield for the trailing twelve months is around 1.88%, more than VFH's 1.53% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
MS Morgan Stanley	1.88%	2.17%	2.82%	3.49%	3.47%	2.14%	2.04%	2.54%	2.77%	1.72%	1.66%	1.73%
VFH Vanguard Financials ETF	1.53%	1.55%	1.75%	2.08%	2.31%	1.87%	2.21%	2.17%	2.30%	1.53%	1.63%	2.00%

Frequently Asked Questions

Can I hold both MS and VFH in my portfolio?

MS and VFH have a correlation of 0.69, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, MS or VFH?

MS has higher volatility (8.06%) compared to VFH (4.28%). In terms of maximum drawdown, MS dropped -88.12% vs VFH's -78.61%.

Which has better risk-adjusted returns?

MS currently has the higher Sharpe Ratio (2.55 vs 0.28), 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.