MSLC vs. MSSM

Last updated Jun 4, 2026

MSLC (Morgan Stanley Pathway Large Cap Equity ETF) and MSSM (Morgan Stanley Pathway Small-Mid Cap Equity ETF) are both exchange-traded funds - MSLC is a Large Cap Blend Equities fund actively managed by Morgan Stanley, while MSSM is a Small Cap Blend Equities fund actively managed by Morgan Stanley. Both are actively managed. Over the past year, MSLC returned 22.69% vs 35.45% for MSSM. Their correlation of 0.85 suggests significant overlap in exposure. MSLC charges 0.39%/yr vs 0.62%/yr for MSSM.

Performance

MSLC vs. MSSM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Morgan Stanley Pathway Large Cap Equity ETF (MSLC) and Morgan Stanley Pathway Small-Mid Cap Equity ETF (MSSM). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, MSLC achieves a 8.55% return, which is significantly lower than MSSM's 17.34% return.

MSLC

• 1D: -0.82%
• 1M: 4.08%
• YTD: 8.55%
• 6M: 8.69%
• 1Y: 22.69%
• 3Y*: —
• 5Y*: —
• 10Y*: —

MSSM

• 1D: -0.79%
• 1M: 3.77%
• YTD: 17.34%
• 6M: 17.18%
• 1Y: 35.45%
• 3Y*: —
• 5Y*: —
• 10Y*: —

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

MSLC vs. MSSM - Yearly Performance Comparison

	2026 (YTD)	2025	2024
MSLC Morgan Stanley Pathway Large Cap Equity ETF	8.55%	15.68%	-3.29%
MSSM Morgan Stanley Pathway Small-Mid Cap Equity ETF	17.34%	11.33%	-5.83%

Correlation

The correlation between MSLC and MSSM is 0.82, 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	0.82
Correlation (All Time) Calculated using the full available price history since Dec 10, 2024	0.85

The correlation between MSLC and MSSM has been stable across timeframes, ranging from 0.82 to 0.85 - a consistent structural relationship.

Return for Risk

MSLC vs. MSSM — Risk / Return Rank

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

MSLC

MSLC Risk / Return Rank: 57
MSLC Sharpe Ratio Rank: 58
MSLC Sortino Ratio Rank: 57
MSLC Omega Ratio Rank: 57
MSLC Calmar Ratio Rank: 50
MSLC Martin Ratio Rank: 61

MSSM

MSSM Risk / Return Rank: 67
MSSM Sharpe Ratio Rank: 63
MSSM Sortino Ratio Rank: 63
MSSM Omega Ratio Rank: 58
MSSM Calmar Ratio Rank: 75
MSSM Martin Ratio Rank: 76

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.

MSLC vs. MSSM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Morgan Stanley Pathway Large Cap Equity ETF (MSLC) and Morgan Stanley Pathway Small-Mid Cap Equity ETF (MSSM). 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.

	MSLC	MSSM	Difference
Sharpe ratio Return per unit of total volatility	1.94	2.07	-0.13
Sortino ratio Return per unit of downside risk	2.68	2.90	-0.22
Omega ratio Gain probability vs. loss probability	1.35	1.35	0.00
Calmar ratio Return relative to maximum drawdown	2.45	3.75	-1.30
Martin ratio Return relative to average drawdown	10.76	14.47	-3.71
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

MSLC vs. MSSM - Sharpe Ratio Comparison

The current MSLC Sharpe Ratio is 1.94, which is comparable to the MSSM Sharpe Ratio of 2.07. The chart below compares the historical Sharpe Ratios of MSLC and MSSM, 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

	MSLC	MSSM	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.94	2.07	-0.13
Sharpe Ratio (All Time) Calculated using the full available price history	0.83	0.73	+0.10

Drawdowns

MSLC vs. MSSM - Drawdown Comparison

The maximum MSLC drawdown since its inception was -17.86%, smaller than the maximum MSSM drawdown of -24.18%. Use the drawdown chart below to compare losses from any high point for MSLC and MSSM.

Drawdown Indicators

	MSLC	MSSM	Difference
Max Drawdown Largest peak-to-trough decline	-17.86%	-24.18%	+6.32%
Max Drawdown (1Y) Largest decline over 1 year	-9.31%	-9.50%	+0.19%
Current Drawdown Current decline from peak	-0.82%	-0.79%	-0.03%
Average Drawdown Average peak-to-trough decline	-2.46%	-4.67%	+2.21%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.11%	2.46%	-0.35%

Volatility

MSLC vs. MSSM - Volatility Comparison

The current volatility for Morgan Stanley Pathway Large Cap Equity ETF (MSLC) is 2.87%, while Morgan Stanley Pathway Small-Mid Cap Equity ETF (MSSM) has a volatility of 5.05%. This indicates that MSLC experiences smaller price fluctuations and is considered to be less risky than MSSM based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	MSLC	MSSM	Difference
Volatility (1M) Calculated over the trailing 1-month period	2.87%	5.05%	-2.18%
Volatility (6M) Calculated over the trailing 6-month period	8.86%	12.76%	-3.90%
Volatility (1Y) Calculated over the trailing 1-year period	11.77%	17.27%	-5.50%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	17.11%	20.91%	-3.80%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	17.11%	20.91%	-3.80%

MSLC vs. MSSM - Expense Ratio Comparison

MSLC has a 0.39% expense ratio, which is lower than MSSM's 0.62% expense ratio.

Dividends

MSLC vs. MSSM - Dividend Comparison

MSLC's dividend yield for the trailing twelve months is around 1.98%, less than MSSM's 2.69% yield.

Position	TTM	2025
MSLC Morgan Stanley Pathway Large Cap Equity ETF	1.98%	2.15%
MSSM Morgan Stanley Pathway Small-Mid Cap Equity ETF	2.69%	3.15%

Frequently Asked Questions

Can I hold both MSLC and MSSM in my portfolio?

MSLC and MSSM have a correlation of 0.82, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, MSLC or MSSM?

MSSM has higher volatility (5.05%) compared to MSLC (2.87%). In terms of maximum drawdown, MSLC dropped -17.86% vs MSSM's -24.18%.

Which ETF is better, MSLC or MSSM?

On 1-year performance, MSSM leads with 35.45% vs 22.69% for MSLC. On fees, MSLC is cheaper at 0.39% per year. On volatility, MSLC has been the lower-risk option at 2.87%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, MSLC or MSSM?

Over the 1-year period, MSSM has performed better with a 35.45% return vs 22.69%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, MSLC or MSSM?

MSLC is cheaper with a 0.39% expense ratio, compared with 0.62% for MSSM.

Which ETF pays a higher dividend yield, MSLC or MSSM?

MSSM has the higher dividend yield at 2.69%, compared with 1.98% for MSLC.

What is the main difference between MSLC and MSSM?

MSLC is categorized as Large Cap Blend Equities, while MSSM is Small Cap Blend Equities. Their fees differ too: 0.39% for MSLC and 0.62% for MSSM.

Which has better risk-adjusted returns?

MSSM currently has the higher Sharpe Ratio (2.07 vs 1.94), 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.