S&P 500 vs Japan
Live side-by-side comparison with current values, changes, and key statistics.
Why This Comparison Matters
Japan's equity market has been a standout performer in recent years as the BOJ maintains ultra-loose policy while the Fed tightens. The yen's weakness has boosted Japanese exporters while US equities face rate headwinds. This comparison is also a proxy for the monetary policy divergence trade between the Fed and the BOJ.
Cross-Asset Analysis
S&P 500 ETF (SPY) measures SPDR S&P 500 ETF, tracks the benchmark US equity index, while Japan / Nikkei (EWJ) measures iShares MSCI Japan ETF, proxy for the Nikkei 225 and Japanese equity market; tracking the two side by side turns that distinction into a tradable signal for the peer pair relationship. Sector, style, and geographic dominance cycles each produce multi-year relative performance episodes between S&P 500 ETF (SPY) and Japan / Nikkei (EWJ). Structural changes inside S&P 500 ETF (SPY) or Japan / Nikkei (EWJ), such as index reconstitution or methodology shifts, can break historical spread relationships in discrete jumps.
Corporate action events, including buybacks or spin-offs affecting constituents of S&P 500 ETF (SPY) or Japan / Nikkei (EWJ), can distort the spread relative to its intended factor tilt. Performance attribution leans on S&P 500 ETF (SPY)-Japan / Nikkei (EWJ) spreads to separate security selection from style allocation inside multi-manager mandates. Factor tilts expressed through the S&P 500 ETF (SPY)-Japan / Nikkei (EWJ) selection allow managers to adjust style exposure without changing their overall asset allocation.
Idiosyncratic events in a concentrated peer, such as a single mega-cap earnings miss inside S&P 500 ETF (SPY), can move the S&P 500 ETF (SPY)-Japan / Nikkei (EWJ) spread without broader factor signal. S&P 500 ETF (SPY) and Japan / Nikkei (EWJ) look similar at a glance, but the embedded factor tilts between them matter meaningfully over time.
90-Day Statistics
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Frequently Asked Questions
What is the relationship between S&P 500 ETF (SPY) and Japan / Nikkei (EWJ)?+
S&P 500 ETF (SPY) and Japan / Nikkei (EWJ) are connected through shared asset class exposure with different factor tilts. When the underlying asset class shifts, both respond, though with different sensitivities and at different speeds. The spread between S&P 500 ETF (SPY) and Japan / Nikkei (EWJ) captures the specific macro signal that flows through this relationship.
When does S&P 500 ETF (SPY) typically lead Japan / Nikkei (EWJ)?+
S&P 500 ETF (SPY) tends to lead Japan / Nikkei (EWJ) during rotation episodes between the two factor exposures. In those periods, moves in S&P 500 ETF (SPY) precede corresponding moves in Japan / Nikkei (EWJ) by days to weeks, depending on the transmission channel and the depth of each market.
How are S&P 500 ETF (SPY) and Japan / Nikkei (EWJ) historically correlated?+
Long-run correlation between S&P 500 ETF (SPY) and Japan / Nikkei (EWJ) varies by regime. Peers in the same asset class are highly correlated in direction, with the spread reflecting factor tilts and rotation dynamics. The correlation is not stable: it shifts with macro conditions, and the periods when it breaks down are often the most informative moments in the S&P 500 ETF (SPY)-Japan / Nikkei (EWJ) relationship.
What macro conditions drive divergence between S&P 500 ETF (SPY) and Japan / Nikkei (EWJ)?+
Divergence between S&P 500 ETF (SPY) and Japan / Nikkei (EWJ) typically arises from index reconstitution, mega-cap earnings surprises, or liquidity differences between the peers. When one asset's idiosyncratic drivers dominate, the spread moves in ways that the common macro story does not predict, which is usually a signal to look more carefully at the specific drivers at work in S&P 500 ETF (SPY) or Japan / Nikkei (EWJ).
Is S&P 500 ETF (SPY) a hedge for Japan / Nikkei (EWJ)?+
Peers like S&P 500 ETF (SPY) and Japan / Nikkei (EWJ) do not hedge each other; both rise or fall with the shared asset class, and using the pair as a spread trade is different from using it as a hedge. Effective hedging requires matching the hedge to the specific risk being protected, and the S&P 500 ETF (SPY)-Japan / Nikkei (EWJ) pair is best stress-tested under scenarios the investor most worries about before being sized into a real portfolio.
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Data sourced from FRED, CoinGecko, CBOE, and other providers. This page is for informational purposes only and does not constitute financial advice. Past performance does not guarantee future results.