USA Rare Earth vs MP Materials (USAR vs MP) 2026: Stock Returns, Risk & Volatility

Q: Which is a better investment: USAR or MP?

Over the past year, MP looks like the better investment: it had higher total return (MP +159.4% vs USAR +90.2%) and a higher Sharpe ratio (MP 1.42 vs USAR 1.09). On risk, MP was less volatile (MP 93.4% vs USAR 123.1%), MP had a smaller max drawdown (MP -53.8% vs USAR -69.2%), and MP had less severe losses on the worst 5% of days (Expected Shortfall of MP -9.54% vs USAR -14.55%).

Written by Gale Finance Team

Reviewed by Sid Kalla CFA Charterholder

Quick answer

Which is a better investment: USAR or MP?

Over the past year, MP outperformed USAR. MP returned +159.4% compared with USAR’s +90.2%. MP had the better risk-adjusted return, with a Sharpe ratio of 1.42 versus USAR’s 1.09. MP was less volatile than USAR, and MP had a smaller max drawdown than USAR.

Total Return

USAR +90.2%

MP +159.4%

Sharpe Ratio

USAR 1.09

MP 1.42

Annualized Volatility

USAR 123.1%

MP 93.4%

Max Drawdown

USAR -69.2%

MP -53.8%

Metric winners: Total Return: MP; Sharpe Ratio: MP; Annualized Volatility: MP (less volatile); Max Drawdown: MP (smaller drawdown).

USAR Total Return

↑ +90.2%

MP Total Return

↑ +159.4%

Relative Performance of USAR vs MP (Normalized to 100)

USAR MP

Normalized to 100 at start date for comparison

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Key Takeaways

Total Return: USAR delivered a +90.2% total return, while MP returned +159.4% over the same period. MP outperformed on total returns.
Risk-Adjusted Return (Sharpe Ratio): MP had a higher Sharpe (1.42 vs 1.09), indicating better risk-adjusted performance.
Volatility (Annualized): USAR was more volatile, with 123.1% annualized volatility, versus 93.4% for MP.
Maximum Drawdown: MP's maximum drawdown was -53.8%, while USAR experienced a deeper drawdown of -69.2%.
Tail Risk (VaR & Expected Shortfall): At the 5% level (daily log returns), USAR's VaR was -11.39% and its Expected Shortfall (CVaR) was -14.55%; MP's were -7.51% and -9.54%. VaR is the cutoff; Expected Shortfall is the average move on the worst days.
Skew & Kurtosis: Skew: USAR 0.39 vs MP 1.81. Excess kurtosis: USAR 0.48 vs MP 11.41. Negative skew leans downside; higher excess kurtosis means fatter tails.
Tail Days & Extremes: 2σ tail days (down/up): USAR 5/9, MP 4/6. Worst day: USAR -18.27% (2025-04-30) vs MP -11.99% (2026-03-30). Best day: USAR +31.14% (2025-07-15) vs MP +50.62% (2025-07-10).
Risk ratios: Sortino - USAR: 1.82 vs. MP: 2.70 , Calmar - USAR: 1.31 vs. MP: 2.99 , Sterling - USAR: 2.18 vs. MP: 5.97 , Treynor - USAR: 0.65 vs. MP: 0.99 , Ulcer Index - USAR: 41.10% vs. MP: 29.71%

Investment Comparison

If you invested $10,000 in each asset on April 25, 2025:

USAR $19,019.77 +90.2%

MP $25,940.19 +159.4%

Difference: $6,920.42 (MP ahead)

USA Rare Earth vs MP Materials Performance Over Time

Metric	USAR	MP
30 Days	39.1%	18.8%
90 Days	-6.8%	-9%
180 Days	-2%	-10.6%
1 Year	90.2%	159.4%

Shorter time frames can show different leaders as market conditions change. Consider your investment horizon when comparing performance.

USA Rare Earth vs MP Materials Correlation

Average Correlation

strongly correlated

0.65

Current (30-day) 0.78

30-day rolling range +0.43 to +0.83

USA Rare Earth and MP Materials are strongly correlated over the past year. With a correlation of 0.65, these assets tend to move together, limiting diversification benefits.

For portfolio construction, this strong correlation means holding both USAR and MP provides limited risk reduction — they're likely to decline together in downturns.

Metric	Value
Current (30-day)	0.78
Average (full period)	0.65
Minimum (30-day rolling)	0.43
Maximum (30-day rolling)	0.83

Correlation measures how closely two assets move together. Values near +1 indicate strong co-movement, near 0 indicates independence, and negative values indicate inverse movement. Current, minimum, and maximum figures are 30-day rolling correlations on shared daily returns.

Drawdown

Maximum Drawdown

USAR

-69.2%

-53.8%

USA Rare Earth experienced its maximum drawdown of -69.2% from 2025-10-13 to 2025-12-31. It has not yet recovered to its previous peak.

MP Materials experienced its maximum drawdown of -53.8% from 2025-10-14 to 2026-03-30. It has not yet recovered to its previous peak.

Smaller drawdowns and faster recoveries indicate lower downside risk and greater resilience during market stress.

USA Rare Earth vs MP Materials Volatility (USAR vs MP)

USAR Volatility

123.1%

±7.76% 1-day vol

MP Volatility

93.4%

±5.88% 1-day vol

1-day volatility (1σ)

USAR

±7.76%

±5.88%

USA Rare Earth's 123.1% annualized volatility translates to about ±7.76% one-standard-deviation daily volatility.

MP Materials's 93.4% annualized volatility translates to about ±5.88% one-standard-deviation daily volatility.

USAR had the wider volatility profile over this window. That means its day-to-day return distribution was broader; MP was calmer, but lower volatility does not by itself mean better returns.

Treat the ± daily figure as a one-standard-deviation estimate from historical returns, not a forecast or expected absolute daily move. For context, 15-18% annualized volatility is roughly ±1% one-standard-deviation daily volatility.

Risk-adjusted ratios

Sharpe Ratio of USAR and MP

Sharpe Ratio: USAR vs. MP

Return per total volatility

Sharpe gives us excess return per unit of risk. Upside and downside volatility both count as risk.

Higher is better

excess return / total volatility

Formula

\displaystyle \mathrm{Sharpe} = \frac{\mathbb{E}[R] - R_f}{\sigma_R}

Sharpe ratio measures return per unit of risk (volatility). A higher Sharpe indicates better risk-adjusted performance. MP had a higher Sharpe (1.42 vs 1.09), indicating better risk-adjusted performance.

A Sharpe above 1.0 is generally considered good, above 2.0 is excellent. Negative Sharpe means the asset underperformed the risk-free rate. Calculated on each asset's full 365-day lookback of available prices and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).

Sortino Ratio of USAR and MP

Sortino Ratio: USAR vs. MP

Return per downside volatility

Sortino keeps the return-over-risk idea, but only returns below the target rate count as volatility.

Higher is better

excess return / downside volatility

Formula

\displaystyle \mathrm{Sortino} = \frac{\mathbb{E}[R] - R_f}{\sigma_{\mathrm{down}}}

Sortino ratio measures return per unit of downside risk. Unlike Sharpe, it only counts downside deviation (returns below the target return). MP had better downside-adjusted returns.

A higher Sortino is better. It's useful when upside volatility is common (crypto is the obvious example). Downside deviation: USAR 73.6% vs MP 48.9%. Calculated on each asset's full 365-day lookback of available prices, using the daily risk-free rate as the target return, and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).

Calmar Ratio of USAR and MP

Calmar Ratio: USAR vs. MP

CAGR per worst drawdown

Calmar compares CAGR against the single deepest peak-to-trough loss over the period.

Higher is better

CAGR / max drawdown

Formula

\displaystyle \mathrm{Calmar} = \frac{\mathrm{CAGR}}{|\mathrm{MaxDD}|}

Calmar ratio compares CAGR to maximum drawdown. Higher Calmar means more return per unit of worst drawdown. MP posted the higher Calmar ratio.

Calmar is computed on each asset's full 365-day lookback and uses the max drawdown over that same window.

Sterling Ratio of USAR and MP

Sterling Ratio: USAR vs. MP

Return per average drawdown

Sterling smooths the drawdown penalty by using average drawdown events instead of only the worst one.

Higher is better

excess annual return / average deep drawdown

Formula

\displaystyle \mathrm{Sterling} = \frac{\mathrm{CAGR} - R_f}{\overline{D}_{>10\%}}

Sterling ratio measures excess return per unit of average drawdown (typically drawdowns worse than 10%). MP posted the higher Sterling ratio.

Sterling uses average drawdown events deeper than 10% and subtracts the risk-free rate to report excess return.

Treynor Ratio of USAR and MP

Treynor Ratio: USAR vs. MP

Excess return per market beta

Treynor divides excess annualized return by beta — the sensitivity of the asset to broad-market moves. The slope shown is each asset’s beta vs SPY.

Higher is better

excess return / market beta

Formula

\displaystyle \mathrm{Treynor} = \frac{\mathbb{E}[R] - R_f}{\beta}

Treynor ratio measures excess return per unit of market risk (beta) instead of total volatility. MP posted the higher Treynor ratio.

Treynor uses beta vs the S&P 500 (SPY) on shared dates and the average 3-month Treasury rate as the risk-free rate.

Ulcer Index of USAR and MP

Ulcer Index: USAR vs. MP

Drawdown pain

Ulcer Index is a risk index, not a return-over-risk ratio. Lower means smaller and shorter drawdowns.

Lower is better

root-mean-square drawdown

Formula

\displaystyle \mathrm{UI} = \sqrt{\mathbb{E}[D_t^2]}

Ulcer Index captures drawdown depth and duration. Lower Ulcer Index means less drawdown pain. MP had the lower Ulcer Index (less drawdown pain).

Ulcer Index is computed from each asset's drawdown series over the full lookback window.

Tail Risk & Distribution Shape (1-Year): USA Rare Earth vs. MP Materials

This section looks at the shape of daily returns, not just the average. Tail stats are computed per asset on its own daily series (crypto includes weekends). We use daily log returns $\ln\left(\frac{P_t}{P_{t-1}}\right)$ so multi-day moves add cleanly.

Definitions: Value at Risk (VaR), Expected Shortfall, skew, kurtosis, and fat tails.

Tail Risk & Distribution Shape: USAR vs. MP (1-Year)

Actual daily return tails

The bars are real daily log-return observations from the article window. Darker bars are observations at or beyond each asset’s 5% VaR cutoff.

Observed returns

VaR marks the 5th percentile loss cutoff; Expected Shortfall averages the observations beyond that cutoff.

Formula

\displaystyle \mathrm{VaR}_{5\%}=Q_{0.05}(r_t),\quad \mathrm{ES}_{5\%}=\mathbb{E}[r_t\mid r_t\le \mathrm{VaR}_{5\%}]

Metric (1-Year)	USAR	MP
5% VaR (daily log return)	-11.39%	-7.51%
5% Expected Shortfall (CVaR)	-14.55% (worst 13 days)	-9.54% (worst 13 days)
Skew	0.39	1.81
Excess kurtosis	0.48	11.41
2σ tail days (down / up)	5 / 9	4 / 6
Worst day	-18.27% (2025-04-30)	-11.99% (2026-03-30)
Best day	+31.14% (2025-07-15)	+50.62% (2025-07-10)

Downside co-moves (2σ) — 1-Year

Computed on shared dates only (n=249). A “2σ downside move” means a shared-close log return more than 2 standard deviations below that asset’s own mean on this shared-date series. Dates below show simple returns (%) for readability.

Downside co-move map: USAR vs. MP (2σ)

Shared-close daily returns

Dots mark actual downside days: asset-colored dots are one-sided downside moves, and red dots are joint downside days. Grey dots add sampled shared-return context when available. The shaded lower-left zone shows where both USAR and MP crossed their own 2σ downside threshold.

2σ

Show downside tail dates

Dates below are shared-date observations. The “Date” is the period end (close). Tail thresholds are computed on log returns, but the table shows simple returns (%) for readability. Returns are computed from the previous shared close to this one (for example, Friday → Monday includes weekend moves).

Days when both USAR and MP had a big down day (2σ)

Date (interval)	USAR	MP
2025-10-21	-15.38%	-10.60%
2025-11-20	-14.69%	-10.81%

Days when USAR had a big down day

Date (interval)	USAR	MP
2025-04-30	-18.27%	-0.49%
2025-06-17	-14.10%	+2.40%
2025-10-16	-15.26%	-6.69%
2025-10-21	-15.38%	-10.60%
2025-11-20	-14.69%	-10.81%

Days when MP had a big down day

Date (interval)	USAR	MP
2025-09-26	-4.76%	-11.02%
2025-10-21	-15.38%	-10.60%
2025-11-20	-14.69%	-10.81%
2026-03-27 → 2026-03-30	-7.72%	-11.99%

Read this as “how ugly the ugly days get”, not as a precise forecast. One-year samples are small, so tail estimates are inherently noisy.

Full Comparison of USA Rare Earth vs. MP Materials (1-Year)

Metric	USAR	MP
Total Return	+90.2%	+159.4%
Annualized Volatility	123.1%	93.4%
Sharpe Ratio	1.09	1.42
Sortino Ratio	1.82	2.70
Calmar Ratio	1.31	2.99
Sterling Ratio	2.18	5.97
Treynor Ratio	0.65	0.99
Ulcer Index	41.10%	29.71%
Max Drawdown	-69.2%	-53.8%
Avg Correlation to S&P 500	0.19	0.20
5% VaR (daily log return)	-11.39%	-7.51%
5% Expected Shortfall (CVaR)	-14.55%	-9.54%
Skew	0.39	1.81
Excess kurtosis	0.48	11.41
2σ tail days (down / up)	5 / 9	4 / 6

Audit this calculation

Formulas, inputs, and conventions used to compute the metrics on this page.

Inputs & conventions

Shared window for pair metrics: 2025-04-25 → 2026-04-23 (last shared close).
Rolling correlation sample (shared closes): 220 rolling 30-day values (from 249 shared daily returns).
Annualization (days/year): USAR: 252 days/year; MP: 252 days/year.
Risk-free rate: Uses the 3-month U.S. Treasury yield (FRED: DGS3MO), averaged over each asset’s window:

USAR: 4.17% over 2025-04-25 → 2026-04-23.

MP: 4.17% over 2025-04-25 → 2026-04-23.
Volatility drag (rule of thumb): Estimated from annualized volatility (simple returns). For the log-return framing, see Log returns.

USAR: ≈ -75.8%/yr

MP: ≈ -43.6%/yr
Data alignment: No forward fill. Correlation and tail co-moves are computed on shared closes only.
For cross-calendar pairs (e.g., crypto vs stocks), weekend/holiday moves roll into the next shared close.
Return conventions: Volatility/Sharpe/Sortino use simple daily returns. Tail-risk uses daily log returns for distribution stats (but tables show simple returns). Log returns.

Formulas

Daily simple return

r_t = \frac{P_t}{P_{t-1}} - 1

Volatility

\sigma_{ann} = \sigma(r_t)\sqrt{A}

Volatility drag (approx.)

\text{drag} \approx \tfrac{1}{2}\sigma_{ann}^2

Sharpe Ratio

S = \frac{A\,\bar{r} - r_f}{\sigma(r_t)\sqrt{A}}

Sortino Ratio

So = \frac{A\,\bar{r} - r_f}{\sqrt{\mathbb{E}[\min(0,\,r_t - r_f/A)^2]}\,\sqrt{A}}

Maximum Drawdown

MDD = \min_t\left(\frac{P_t}{\max_{s \le t} P_s} - 1\right)

Average Correlation

\rho = \frac{\operatorname{cov}(r^A,\,r^B)}{\sigma_A\,\sigma_B}

Log returns

\ell_t = \ln\left(\frac{P_t}{P_{t-1}}\right)

Notation

$P_t$: Price on day t.
$r_t$: Simple daily return.
$\ell_t$: Log daily return.
$\bar{r}$: Average daily return.
$\sigma(r_t)$: Standard deviation of daily returns.
$A$: Annualization factor (days/year).
$r_f$: Annual risk-free rate.

USA Rare Earth vs MP Materials: Frequently Asked Questions

Which has higher volatility: USAR or MP?

USAR showed higher volatility at 123.1% annualized, compared to 93.4% for MP Over the past year. Higher volatility means larger price swings in both directions.

Does USAR provide diversification when held with MP?

USAR and MP are strongly correlated over the past year, with an average correlation of 0.65. This strong correlation limits diversification benefits.

How bad are the worst 5% days for USAR vs MP?

Over the past year, USAR's 5% VaR was -11.39% and its 5% Expected Shortfall was -14.55% (worst 13 days). MP's were -7.51% and -9.54% (worst 13 days).

Do USAR and MP crash together on bad days?

On shared dates (n=249), when MP has a 2σ down day, USAR also does 50.0% (2/4 days). In the other direction, when USAR has one, MP also does 40.0% (2/5 days).

Which has better risk-adjusted returns: USAR or MP?

MP showed better risk-adjusted performance with a Sharpe ratio of 1.42 versus USAR's 1.09 Over the past year.

Can USAR and MP be combined in a portfolio?

Yes, though allocation sizing matters. Their strong correlation provides limited risk reduction since they tend to move together. USAR's higher volatility (123.1%) means even small allocations can materially impact overall portfolio risk.

Explore our financial glossary

Which is a better investment: USAR or MP?

Share This Comparison of USAR vs MP

Relative Performance of USAR vs MP (Normalized to 100)

Trade USAR or MP

Key Takeaways

Investment Comparison

USA Rare Earth vs MP Materials Performance Over Time

USA Rare Earth vs MP Materials Correlation

Drawdown

USA Rare Earth vs MP Materials Volatility (USAR vs MP)

Risk-adjusted ratios

Sharpe Ratio of USAR and MP

Sharpe Ratio: USAR vs. MP

Sortino Ratio of USAR and MP

Sortino Ratio: USAR vs. MP

Calmar Ratio of USAR and MP

Calmar Ratio: USAR vs. MP

Sterling Ratio of USAR and MP

Sterling Ratio: USAR vs. MP

Treynor Ratio of USAR and MP

Treynor Ratio: USAR vs. MP

Ulcer Index of USAR and MP

Ulcer Index: USAR vs. MP

Tail Risk & Distribution Shape (1-Year): USA Rare Earth vs. MP Materials

Tail Risk & Distribution Shape: USAR vs. MP (1-Year)

Downside co-moves (2σ) — 1-Year

Downside co-move map: USAR vs. MP (2σ)

Days when both USAR and MP had a big down day (2σ)

Days when USAR had a big down day

Days when MP had a big down day

Full Comparison of USA Rare Earth vs. MP Materials (1-Year)

Inputs & conventions

Formulas

USA Rare Earth vs MP Materials: Frequently Asked Questions

Which has higher volatility: USAR or MP?

Does USAR provide diversification when held with MP?

How bad are the worst 5% days for USAR vs MP?

Do USAR and MP crash together on bad days?

Which has better risk-adjusted returns: USAR or MP?

Can USAR and MP be combined in a portfolio?