CAF vs EEM: Correlation
Morgan Stanley China A Share Fund Inc. (CAF) and iShares MSCI Emerging Markets ETF (EEM) show a moderate relationship: their 3-year correlation of weekly returns is 0.54.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are CAF and EEM?
Across a 3-year window, the weekly returns of CAF and EEM correlate at 0.54, moderate. The relationship has been stable: the 1-year correlation (0.51) sits close to the 3-year figure. Stretching to 5 years gives 0.60, with an annualized covariance of 198.8 %².
By 3-year correlation, EEM places #5 of the 14 assets tracked against CAF. The trailing year gives EEM the advantage: +29.7% versus +38.1%, a 8.4-point spread.
How is this computed?
Pearson correlation on weekly returns: ρ(A,B) = cov(rA, rB) / (σA · σB), over windows of 52, 156 and 260 weeks. Covariance is annualized (×52) and expressed in %². Full definitions on the methodology page.
CAF vs EEM: side by side
| CAF (Morgan Stanley China A Share Fund Inc.) | EEM (iShares MSCI Emerging Markets ETF) | |
|---|---|---|
| 1-year return | +29.7% | +38.1% |
| 5-year return | +4.1% | +47.1% |
| Volatility (ann.) | 20.4% | 18.0% |
| Beta vs S&P 500 | 0.48 | 0.85 |
| Max drawdown (3Y) | -26.3% | -17.3% |
| Market cap | $0.3B | – |
| P/E (trailing) | 4.6 | – |
| Dividend yield | 0.00% | 1.73% |
| Expense ratio | – | 0.72% |
| Assets under management | – | $29.2B |
| Sector / category | US Listed | ETF · International |
EEM is a Diversified Emerging Mkts fund from iShares: $29.2B under management, 968 holdings, a 0.72% expense ratio, a 1.73% trailing dividend yield.
Year-by-year returns
| Year | CAF | EEM |
|---|---|---|
| 2022 | -30.4% | -20.6% |
| 2023 | -9.4% | +8.9% |
| 2024 | +0.3% | +6.5% |
| 2025 | +41.5% | +34.0% |
| 2026 | +9.7% | +24.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are CAF and EEM good diversifiers for each other?
To a limited degree. At 0.54 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
FAQ
What is the correlation between CAF and EEM?
As of 2026-08-27, the correlation of weekly returns between CAF and EEM is 0.54 over 3 years, 0.51 over 1 year and 0.60 over 5 years.
Is EEM a good diversifier for CAF?
To a limited degree. At 0.54 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
What does a correlation of 0.54 mean?
On the −1 to +1 scale, 0.54 describes how much the two returns move together: +1 is lockstep, 0 is independence, negative values mean opposite directions. It says nothing about which performed better.
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Related comparisons
Hubs: CAF correlations · EEM correlations
