Exchange-traded funds have transformed how Canadians invest. A single ETF gives you exposure to hundreds of global companies at an annual fee as low as 0.06%. This guide compares the top Canadian-listed ETFs for 2026 — covering MER, diversification, and historical performance so you can choose the right one for your TFSA or RRSP.
All-in-one ETFs hold diversified portfolios of global stocks (and sometimes bonds) in a single fund. They're the simplest, most cost-effective way to build a complete portfolio without ever needing to rebalance.
| ETF | Issuer | MER | Equity | Bond | AUM |
|---|---|---|---|---|---|
| XEQT | iShares | 0.20% | 100% | 0% | $4.2B |
| VEQT | Vanguard | 0.24% | 100% | 0% | $3.8B |
| XGRO | iShares | 0.20% | 80% | 20% | $2.1B |
| VGRO | Vanguard | 0.24% | 80% | 20% | $3.5B |
| XBAL | iShares | 0.20% | 60% | 40% | $1.3B |
| VBAL | Vanguard | 0.24% | 60% | 40% | $1.8B |
Both XEQT and VEQT are 100% equity all-in-one ETFs providing global diversification. XEQT holds approximately 25% Canadian equities, 45% US, 20% international developed, and 10% emerging markets. VEQT holds approximately 30% Canada, 42% US, 18% international, and 10% emerging.
XEQT is slightly cheaper at 0.20% MER vs VEQT's 0.24%. On a $200,000 portfolio over 25 years at 7% growth, that 0.04% difference saves approximately $7,000. Both are excellent choices — the decision is largely brand preference (iShares vs Vanguard). If you already hold other iShares ETFs, XEQT is the natural fit; if you're a Vanguard loyalist, go with VEQT.
For direct S&P 500 exposure, these ETFs trade on the TSX in Canadian dollars, making them accessible in any brokerage:
| ETF | MER | Hedged? | 5-yr Ann. Return* |
|---|---|---|---|
| VFV (Vanguard) | 0.09% | No | ~16.2% |
| ZSP (BMO) | 0.09% | No | ~16.1% |
| XUS (iShares) | 0.10% | No | ~16.0% |
| VSP (Vanguard) | 0.09% | Yes | ~13.5% |
*Approximate 5-year annualized returns to end of 2025. Past performance does not guarantee future results.
VFV and ZSP are the top picks. The unhedged versions outperformed the hedged versions over the past decade because the US dollar strengthened against the Canadian dollar — but currency hedging adds a drag of roughly 0.3–0.5% annually regardless of direction, making unhedged the default choice for long-term investors.
| ETF | MER | Index Tracked | Holdings |
|---|---|---|---|
| VCN | 0.05% | FTSE Canada All Cap | ~182 |
| XIC | 0.06% | S&P/TSX Capped Composite | ~237 |
| ZCN | 0.06% | S&P/TSX Capped Composite | ~237 |
VCN wins on cost at 0.05% MER. The TSX is heavily tilted toward Financials (~35%) and Energy (~18%) — sectors that pay strong dividends but lack the technology-driven growth of the S&P 500. For that reason, many investors hold a global ETF like XEQT rather than a Canada-only ETF as their core holding.
| ETF | MER | Yield | Strategy |
|---|---|---|---|
| VDY | 0.22% | ~4.3% | High-yield Canadian stocks |
| CDZ | 0.66% | ~3.8% | Dividend Aristocrats (5+ yr growth) |
| XDV | 0.55% | ~4.0% | Select Canadian high-dividend |
VDY is the best value for dividend income. CDZ's dividend growth screen provides quality exposure but at a 3x higher fee. For income-focused investors, VDY held in a non-registered account takes advantage of the Canadian dividend tax credit.
For investors wanting to overweight specific sectors:
Use sector ETFs to tilt your portfolio, not as a replacement for diversification. Allocate no more than 10–20% to any single sector ETF.
ETFs on the TSX trade in real time during market hours (9:30 AM – 4:00 PM ET). For all-in-one ETFs like XEQT, a market order is fine — the bid-ask spread is typically 1–3 cents on a $30–$35 unit.
The average Canadian mutual fund charges an MER of 2.0–2.5%. A typical balanced mutual fund at 2.2% MER vs VGRO at 0.24% means you're paying nearly 10x more in fees for similar exposure. On a $300,000 portfolio over 25 years at 7% gross returns, the mutual fund investor ends up with approximately $440,000 less than the ETF investor — entirely due to fees. This is why the shift to low-cost ETFs is one of the most impactful financial decisions any Canadian can make.
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Get KOHO Free →Last updated: March 2026. For informational purposes only. Not financial advice.