IEFA vs VWO: Correlation & Overlap
Measured on weekly returns over the past three years, iShares Core MSCI EAFE ETF (IEFA) and Vanguard FTSE Emerging Markets ETF (VWO) carry a correlation of 0.81, a very strong link. Looking through to holdings, 0.8% 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 VWO?
Over the past 3 years, IEFA and VWO moved with a correlation of 0.81, which is very strong, meaning they move nearly in lockstep. Recent behaviour matches the longer record: 0.88 over 1 year against 0.81 over 3. Over 5 years the correlation is 0.80, and the annualized covariance of weekly returns is 184.7 %².
By 3-year correlation, VWO places #12 of the 111 assets tracked against IEFA. Twelve-month performance is nearly a tie, at +21.8% for IEFA and +21.6% for VWO. The link looks structural: the rolling one-year correlation barely moved, holding between 0.67 and 0.89.
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 VWO: side by side
| IEFA (iShares Core MSCI EAFE ETF) | VWO (Vanguard FTSE Emerging Markets ETF) | |
|---|---|---|
| 1-year return | +21.8% | +21.6% |
| 5-year return | +54.5% | +38.2% |
| Volatility (ann.) | 15.0% | 15.2% |
| Beta vs S&P 500 | 0.77 | 0.75 |
| Max drawdown (3Y) | -13.8% | -17.4% |
| Dividend yield | 3.35% | 2.36% |
| Expense ratio | 0.07% | 0.06% |
| Assets under management | $190.1B | $162.0B |
| Sector / category | ETF · International | ETF · International |
IEFA is a Foreign Large Blend fund from iShares: $190.1B under management, 1620 holdings, a 0.07% expense ratio, a 3.35% trailing dividend yield. On the fund side, VWO sits in the Diversified Emerging Mkts category at Vanguard, with $162.0B under management, 4113 holdings, a 0.06% expense ratio, a 2.36% trailing dividend yield.
Portfolio overlap between IEFA and VWO
The two portfolios are largely distinct, with 66 holdings in common adding up to 0.8% of fund weight. Where correlation shows the co-movement, the overlap shows its source.
| Common holding | Weight in IEFA | Weight in VWO |
|---|---|---|
| DSY | 0.07% | 0.09% |
| SOL | 0.05% | 0.08% |
| 7203 | 0.69% | 0.05% |
| VOD | 0.11% | 0.04% |
| 1801 | 0.04% | 0.19% |
| BS6 | 0.04% | 0.08% |
| 1605 | 0.08% | 0.03% |
| 2801 | 0.03% | 0.06% |
| 2269 | 0.03% | 0.19% |
| AC | 0.04% | 0.03% |
| TEL | 0.03% | 0.02% |
| 6869 | 0.02% | 0.05% |
| EL | 0.21% | 0.02% |
| 6098 | 0.54% | 0.02% |
| 4004 | 0.07% | 0.01% |
Largest positions held only by IEFA: ASML (2.57%), HSBA (1.35%), ROP (1.22%), SAN (1.17%), NOVN (1.10%). Only by VWO: 2330 (18.65%), 700 (3.97%), 9988 (2.90%), 2454 (1.62%), 939 (1.07%).
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 | IEFA | VWO |
|---|---|---|
| 2022 | -15.2% | -18.0% |
| 2023 | +18.0% | +9.3% |
| 2024 | +3.3% | +10.6% |
| 2025 | +32.1% | +25.6% |
| 2026 | +14.5% | +13.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEFA and VWO good diversifiers for each other?
Not really. At 0.81, the two trade almost as one position, and owning both buys little extra protection.
FAQ
What is the correlation between IEFA and VWO?
As of 2026-08-27, the correlation of weekly returns between IEFA and VWO is 0.81 over 3 years, 0.88 over 1 year and 0.80 over 5 years.
Is VWO a good diversifier for IEFA?
Not really. At 0.81, the two trade almost as one position, and owning both buys little extra protection.
How much do IEFA and VWO overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 0.8% by weight over 66 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/iefa-vs-vwo.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/iefa-vs-vwo/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: IEFA correlations · VWO correlations
