EFA vs SPY: Correlation & Overlap
How closely do iShares MSCI EAFE ETF (EFA) and SPDR S&P 500 ETF Trust (SPY) trade together? Their weekly returns over three years give a correlation of 0.75, which is strong. The two funds also share 1.0% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are EFA and SPY?
Over the past 3 years, EFA and SPY moved with a correlation of 0.75, which is strong. Little has changed lately, as the 1-year reading of 0.72 lands near the 3-year figure. Over 5 years the correlation is 0.79, and the annualized covariance of weekly returns is 161.1 %².
Within EFA's tracked universe of 109 assets, SPY comes in at #27 by 3-year correlation. Their 12-month results are close: +21.9% for EFA against +20.6% for SPY. The link looks structural: the rolling one-year correlation barely moved, holding between 0.62 and 0.86.
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 SPY: side by side
| EFA (iShares MSCI EAFE ETF) | SPY (SPDR S&P 500 ETF Trust) | |
|---|---|---|
| 1-year return | +21.9% | +20.6% |
| 5-year return | +56.7% | +82.4% |
| Volatility (ann.) | 14.9% | 14.5% |
| Beta vs S&P 500 | 0.77 | 1.00 |
| Max drawdown (3Y) | -14.1% | -18.8% |
| Dividend yield | 3.19% | 1.01% |
| Expense ratio | 0.32% | 0.09% |
| Assets under management | $78.0B | $795.3B |
| Sector / category | ETF · International | ETF · US Large Cap |
EFA is a Foreign Large Blend fund from iShares: $78.0B under management, 666 holdings, a 0.32% expense ratio, a 3.19% trailing dividend yield. SPY is a Large Blend fund from State Street Investment Management: $795.3B under management, 504 holdings, a 0.09% expense ratio, a 1.01% trailing dividend yield.
Portfolio overlap between EFA and SPY
The two portfolios are largely distinct: 1.0% of the funds' weight sits in the same underlying holdings (18 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in EFA | Weight in SPY |
|---|---|---|
| BA | 0.37% | 0.25% |
| ALL | 0.11% | 0.10% |
| MRK | 0.09% | 0.57% |
| PRU | 0.16% | 0.06% |
| ROP | 1.42% | 0.06% |
| ADM | 0.06% | 0.06% |
| HBAN | 0.09% | 0.05% |
| EQT | 0.07% | 0.05% |
| DTE | 0.51% | 0.04% |
| DG | 0.29% | 0.04% |
| TEL | 0.04% | 0.09% |
| EL | 0.25% | 0.04% |
| SW | 0.03% | 0.04% |
| TSCO | 0.18% | 0.03% |
| BG | 0.07% | 0.02% |
Largest positions held only by EFA: ASML (2.99%), HSBA (1.57%), SAN (1.38%), NOVN (1.28%), SHEL (1.14%). Only by SPY: NVDA (7.68%), AAPL (6.96%), MSFT (5.58%), AMZN (3.85%), GOOGL (3.03%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 15 common positions shown.
Year-by-year returns
| Year | EFA | SPY |
|---|---|---|
| 2022 | -14.4% | -18.2% |
| 2023 | +18.4% | +26.2% |
| 2024 | +3.5% | +24.9% |
| 2025 | +31.5% | +17.7% |
| 2026 | +14.3% | +13.7% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are EFA and SPY good diversifiers for each other?
Somewhat, no more. With 0.75 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between EFA and SPY?
The EFA/SPY correlation stands at 0.75 on a 3-year window (1 year: 0.72, 5 years: 0.79), computed from weekly returns as of 2026-08-27.
Is SPY a good diversifier for EFA?
Somewhat, no more. With 0.75 correlation, most large moves hit both names, and the diversification benefit stays modest.
How much do EFA and SPY overlap?
The two funds share 18 holdings amounting to 1.0% of weight, per issuer portfolio files dated 2026-08-26.
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