EFA vs IAF: Correlation
Measured on weekly returns over the past three years, iShares MSCI EAFE ETF (EFA) and abrdn Australia Equity Fund, Inc. (IAF) carry a correlation of 0.78, a strong link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are EFA and IAF?
Across a 3-year window, the weekly returns of EFA and IAF correlate at 0.78, strong. The relationship has been stable: the 1-year correlation (0.82) sits close to the 3-year figure. Stretching to 5 years gives 0.73, with an annualized covariance of 217.8 %².
Within EFA's tracked universe of 109 assets, IAF comes in at #17 by 3-year correlation. The trailing year gives EFA the advantage: +21.9% versus +9.0%, a 12.9-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.
EFA vs IAF: side by side
| EFA (iShares MSCI EAFE ETF) | IAF (abrdn Australia Equity Fund, Inc.) | |
|---|---|---|
| 1-year return | +21.9% | +9.0% |
| 5-year return | +56.7% | +23.6% |
| Volatility (ann.) | 14.9% | 18.6% |
| Beta vs S&P 500 | 0.77 | 0.88 |
| Max drawdown (3Y) | -14.1% | -23.6% |
| Market cap | – | $0.1B |
| P/E (trailing) | – | 7.7 |
| Dividend yield | 3.19% | 10.76% |
| Expense ratio | 0.32% | – |
| Assets under management | $78.0B | – |
| Sector / category | ETF · International | US Listed |
EFA, iShares's Foreign Large Blend fund, carries $78.0B under management, 666 holdings, a 0.32% expense ratio, a 3.19% trailing dividend yield.
Year-by-year returns
| Year | EFA | IAF |
|---|---|---|
| 2022 | -14.4% | -19.4% |
| 2023 | +18.4% | +10.4% |
| 2024 | +3.5% | +8.2% |
| 2025 | +31.5% | +14.9% |
| 2026 | +14.3% | +12.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are EFA and IAF good diversifiers for each other?
Somewhat, no more. With 0.78 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between EFA and IAF?
Using weekly returns as of 2026-08-27: 0.78 over 3 years, with 0.82 over the last year and 0.73 over 5 years.
Is IAF a good diversifier for EFA?
Somewhat, no more. With 0.78 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.78 mean?
A reading of 0.78 sits on a scale from −1 (opposite moves) through 0 (unrelated) to +1 (identical moves). Correlation captures direction, not magnitude or performance.
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Related comparisons
Hubs: EFA correlations · IAF correlations
