IEMG vs VYM: Correlation & Overlap
How closely do iShares Core MSCI Emerging Markets ETF (IEMG) and Vanguard High Dividend Yield ETF (VYM) trade together? Their weekly returns over three years give a correlation of 0.58, which is moderate. Looking through to holdings, 0.4% 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 IEMG and VYM?
On 3 years of weekly data the IEMG/VYM correlation comes out at 0.58, moderate. The relationship has been stable: the 1-year correlation (0.55) sits close to the 3-year figure. The 5-year figure is 0.56, and annualized covariance runs at 124.2 %².
Among the 68 assets we track against IEMG, VYM ranks #43 by 3-year correlation. The trailing year gives IEMG the advantage: +36.0% versus +21.1%, a 14.9-point spread. Across three years, the rolling one-year figure varied moderately, from 0.42 to 0.77.
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.
IEMG vs VYM: side by side
| IEMG (iShares Core MSCI Emerging Markets ETF) | VYM (Vanguard High Dividend Yield ETF) | |
|---|---|---|
| 1-year return | +36.0% | +21.1% |
| 5-year return | +50.7% | +76.6% |
| Volatility (ann.) | 17.4% | 12.3% |
| Beta vs S&P 500 | 0.84 | 0.69 |
| Max drawdown (3Y) | -17.2% | -14.5% |
| Dividend yield | 2.31% | 2.24% |
| Expense ratio | 0.09% | 0.04% |
| Assets under management | $152.2B | $99.2B |
| Sector / category | ETF · International | ETF · Dividend |
On the fund side, IEMG sits in the Diversified Emerging Mkts category at iShares, with $152.2B under management, 1824 holdings, a 0.09% expense ratio, a 2.31% 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 IEMG and VYM
The two portfolios are largely distinct. Weighing the shared positions, 0.4% of the two funds is identical, spread across 17 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in IEMG | Weight in VYM |
|---|---|---|
| BAP | 0.18% | 0.11% |
| SCCO | 0.14% | 0.07% |
| HAL | 0.06% | 0.11% |
| XP | 0.05% | 0.03% |
| MTN | 0.15% | 0.02% |
| BDX | 0.02% | 0.19% |
| SLM | 0.07% | 0.02% |
| TEL | 0.01% | 0.24% |
| MTH | 0.01% | 0.02% |
| NXST | 0.01% | 0.02% |
| SM | 0.01% | 0.03% |
| SRE | 0.01% | 0.24% |
| CCL | 0.01% | 0.14% |
| AUGO | 0.02% | 0.01% |
| HTO | 0.03% | 0.01% |
Largest positions held only by IEMG: 2330 (13.28%), 005930 (6.27%), 000660 (4.78%), 700 (2.49%), 9988 (1.77%). 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 | IEMG | VYM |
|---|---|---|
| 2022 | -20.0% | -0.4% |
| 2023 | +11.5% | +6.6% |
| 2024 | +6.5% | +17.6% |
| 2025 | +32.6% | +15.4% |
| 2026 | +23.6% | +15.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEMG and VYM good diversifiers for each other?
Only partially. A correlation of 0.58 means IEMG and VYM share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
FAQ
What is the correlation between IEMG and VYM?
The IEMG/VYM correlation stands at 0.58 on a 3-year window (1 year: 0.55, 5 years: 0.56), computed from weekly returns as of 2026-08-27.
Is VYM a good diversifier for IEMG?
Only partially. A correlation of 0.58 means IEMG and VYM share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
How much do IEMG and VYM overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 0.4% by weight over 17 common positions.
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