EFA vs VYM: Correlation & Overlap
iShares MSCI EAFE ETF (EFA) and Vanguard High Dividend Yield ETF (VYM) show a strong relationship: their 3-year correlation of weekly returns is 0.75. Looking through to holdings, 1.4% of the two portfolios is the same by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are EFA and VYM?
Over the past 3 years, EFA and VYM moved with a correlation of 0.75, which is strong. Little has changed lately, as the 1-year reading of 0.74 lands near the 3-year figure. Over 5 years the correlation is 0.76, and the annualized covariance of weekly returns is 136.8 %².
Among the 109 assets we track against EFA, VYM ranks #29 by 3-year correlation. Their 12-month results are close: +21.9% for EFA against +21.1% for VYM. Stability stands out here, with the rolling one-year correlation confined to 0.60 through 0.84.
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 VYM: side by side
| EFA (iShares MSCI EAFE ETF) | VYM (Vanguard High Dividend Yield ETF) | |
|---|---|---|
| 1-year return | +21.9% | +21.1% |
| 5-year return | +56.7% | +76.6% |
| Volatility (ann.) | 14.9% | 12.3% |
| Beta vs S&P 500 | 0.77 | 0.69 |
| Max drawdown (3Y) | -14.1% | -14.5% |
| Dividend yield | 3.19% | 2.24% |
| Expense ratio | 0.32% | 0.04% |
| Assets under management | $78.0B | $99.2B |
| Sector / category | ETF · International | ETF · Dividend |
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. VYM, Vanguard's Large Value fund, carries $99.2B under management, 604 holdings, a 0.04% expense ratio, a 2.24% trailing dividend yield.
Portfolio overlap between EFA and VYM
The two portfolios are largely distinct, with 27 holdings in common adding up to 1.4% of fund weight. Where correlation shows the co-movement, the overlap shows its source.
| Common holding | Weight in EFA | Weight in VYM |
|---|---|---|
| PRU | 0.16% | 0.17% |
| DTE | 0.51% | 0.12% |
| DG | 0.29% | 0.11% |
| ALL | 0.11% | 0.28% |
| MRK | 0.09% | 1.31% |
| HBAN | 0.09% | 0.14% |
| EL | 0.25% | 0.08% |
| EQT | 0.07% | 0.13% |
| TSCO | 0.18% | 0.07% |
| ADM | 0.06% | 0.15% |
| BG | 0.07% | 0.06% |
| APA | 0.05% | 0.05% |
| TEL | 0.04% | 0.24% |
| CFR | 0.56% | 0.04% |
| ALV | 0.88% | 0.04% |
Largest positions held only by EFA: ASML (2.99%), HSBA (1.57%), ROP (1.42%), SAN (1.38%), NOVN (1.28%). Only by VYM: AVGO (7.37%), JPM (3.83%), XOM (2.63%), JNJ (2.51%), CSCO (1.87%).
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 | VYM |
|---|---|---|
| 2022 | -14.4% | -0.4% |
| 2023 | +18.4% | +6.6% |
| 2024 | +3.5% | +17.6% |
| 2025 | +31.5% | +15.4% |
| 2026 | +14.3% | +15.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are EFA and VYM 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 VYM?
Using weekly returns as of 2026-08-27: 0.75 over 3 years, with 0.74 over the last year and 0.76 over 5 years.
Is VYM 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 VYM overlap?
The two funds share 27 holdings amounting to 1.4% of weight, per issuer portfolio files dated 2026-08-26.
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