EWJ vs IEFA: Correlation & Overlap
iShares MSCI Japan ETF (EWJ) and iShares Core MSCI EAFE ETF (IEFA) show a very strong relationship: their 3-year correlation of weekly returns is 0.87. Looking through to holdings, 19.9% 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 EWJ and IEFA?
Across a 3-year window, the weekly returns of EWJ and IEFA correlate at 0.87, very strong, meaning they move nearly in lockstep. Little has changed lately, as the 1-year reading of 0.85 lands near the 3-year figure. Stretching to 5 years gives 0.85, with an annualized covariance of 255.7 %².
IEFA is one of the assets that tracks EWJ most closely: it ranks #3 out of the 70 assets we track against EWJ. The trailing year gives EWJ the advantage: +27.1% versus +21.8%, a 5.3-point spread. The link looks structural: the rolling one-year correlation barely moved, holding between 0.78 and 0.93.
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.
EWJ vs IEFA: side by side
| EWJ (iShares MSCI Japan ETF) | IEFA (iShares Core MSCI EAFE ETF) | |
|---|---|---|
| 1-year return | +27.1% | +21.8% |
| 5-year return | +58.6% | +54.5% |
| Volatility (ann.) | 19.6% | 15.0% |
| Beta vs S&P 500 | 0.94 | 0.77 |
| Max drawdown (3Y) | -14.7% | -13.8% |
| Dividend yield | 3.86% | 3.35% |
| Expense ratio | 0.49% | 0.07% |
| Assets under management | $21.8B | $190.1B |
| Sector / category | ETF · International | ETF · International |
EWJ is a Japan Stock fund from iShares: $21.8B under management, 168 holdings, a 0.49% expense ratio, a 3.86% trailing dividend yield. IEFA, iShares's Foreign Large Blend fund, carries $190.1B under management, 1620 holdings, a 0.07% expense ratio, a 3.35% trailing dividend yield.
Portfolio overlap between EWJ and IEFA
The two portfolios partially overlap, with 168 holdings in common adding up to 19.9% of fund weight. Where correlation shows the co-movement, the overlap shows its source.
| Common holding | Weight in EWJ | Weight in IEFA |
|---|---|---|
| 8306 | 4.56% | 0.91% |
| 7203 | 3.47% | 0.69% |
| 6857 | 3.12% | 0.62% |
| 8035 | 2.97% | 0.59% |
| 8316 | 2.92% | 0.58% |
| 6501 | 2.80% | 0.56% |
| 6098 | 2.71% | 0.54% |
| 6758 | 2.70% | 0.54% |
| 8411 | 2.35% | 0.47% |
| 9984 | 2.29% | 0.46% |
| 285A | 1.87% | 0.37% |
| 6861 | 1.83% | 0.36% |
| 8058 | 1.70% | 0.34% |
| 9983 | 1.64% | 0.33% |
| 8766 | 1.63% | 0.32% |
Largest positions held only by EWJ: . Only by IEFA: ASML (2.57%), HSBA (1.35%), ROP (1.22%), SAN (1.17%), NOVN (1.10%).
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 | EWJ | IEFA |
|---|---|---|
| 2022 | -17.7% | -15.2% |
| 2023 | +20.3% | +18.0% |
| 2024 | +7.0% | +3.3% |
| 2025 | +25.8% | +32.1% |
| 2026 | +19.3% | +14.5% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are EWJ and IEFA good diversifiers for each other?
No: a correlation of 0.87 means EWJ and IEFA tend to fall together, which is precisely when diversification is supposed to help.
FAQ
What is the correlation between EWJ and IEFA?
Using weekly returns as of 2026-08-27: 0.87 over 3 years, with 0.85 over the last year and 0.85 over 5 years.
Is IEFA a good diversifier for EWJ?
No: a correlation of 0.87 means EWJ and IEFA tend to fall together, which is precisely when diversification is supposed to help.
How much do EWJ and IEFA overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 19.9% by weight over 168 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/ewj-vs-iefa.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/ewj-vs-iefa/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: EWJ correlations · IEFA correlations
