IEFA vs QQQ: Correlation & Overlap
How closely do iShares Core MSCI EAFE ETF (IEFA) and Invesco QQQ Trust (QQQ) trade together? Their weekly returns over three years give a correlation of 0.66, which is strong. Looking through to holdings, 1.3% 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 IEFA and QQQ?
Over the past 3 years, IEFA and QQQ moved with a correlation of 0.66, which is strong. The relationship has been stable: the 1-year correlation (0.61) sits close to the 3-year figure. Over 5 years the correlation is 0.70, and the annualized covariance of weekly returns is 192.7 %².
By 3-year correlation, QQQ places #45 of the 111 assets tracked against IEFA. Twelve-month performance is nearly a tie, at +21.8% for IEFA and +26.3% for QQQ. The rolling one-year correlation stayed in a tight band between 0.56 and 0.74 over the past three years, which points to a structural rather than episodic relationship.
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.
IEFA vs QQQ: side by side
| IEFA (iShares Core MSCI EAFE ETF) | QQQ (Invesco QQQ Trust) | |
|---|---|---|
| 1-year return | +21.8% | +26.3% |
| 5-year return | +54.5% | +95.4% |
| Volatility (ann.) | 15.0% | 19.6% |
| Beta vs S&P 500 | 0.77 | 1.28 |
| Max drawdown (3Y) | -13.8% | -22.8% |
| Dividend yield | 3.35% | 0.44% |
| Expense ratio | 0.07% | 0.18% |
| Assets under management | $190.1B | $452.8B |
| Sector / category | ETF · International | ETF · US Growth & Tech |
On the fund side, IEFA sits in the Foreign Large Blend category at iShares, with $190.1B under management, 1620 holdings, a 0.07% expense ratio, a 3.35% trailing dividend yield. QQQ is a Large Growth fund from Invesco: $452.8B under management, 104 holdings, a 0.18% expense ratio, a 0.44% trailing dividend yield.
Portfolio overlap between IEFA and QQQ
The two portfolios are largely distinct: 1.3% of the funds' weight sits in the same underlying holdings (7 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in IEFA | Weight in QQQ |
|---|---|---|
| ASML | 2.57% | 0.71% |
| ROP | 1.22% | 0.18% |
| NBIS | 0.16% | 0.21% |
| FER | 0.11% | 0.19% |
| CCEP | 0.09% | 0.22% |
| ADP | 0.02% | 0.50% |
| TRI | 0.01% | 0.17% |
Largest positions held only by IEFA: HSBA (1.35%), SAN (1.17%), NOVN (1.10%), NESN (0.97%), SHEL (0.97%). Only by QQQ: NVDA (8.15%), AAPL (7.39%), MSFT (5.93%), MU (4.69%), AMZN (4.50%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 7 common positions shown.
Year-by-year returns
| Year | IEFA | QQQ |
|---|---|---|
| 2022 | -15.2% | -32.6% |
| 2023 | +18.0% | +54.9% |
| 2024 | +3.3% | +25.6% |
| 2025 | +32.1% | +20.8% |
| 2026 | +14.5% | +17.7% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEFA and QQQ good diversifiers for each other?
To a limited degree. At 0.66 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
FAQ
What is the correlation between IEFA and QQQ?
Using weekly returns as of 2026-08-27: 0.66 over 3 years, with 0.61 over the last year and 0.70 over 5 years.
Is QQQ a good diversifier for IEFA?
To a limited degree. At 0.66 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
How much do IEFA and QQQ overlap?
1.3% by weight, across 7 common holdings, based on issuer-disclosed portfolios as of 2026-08-26.
Use this data
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Related comparisons
Hubs: IEFA correlations · QQQ correlations
