The good news about ETF investing in Canada: the "best" choice for most people is also the simplest. You do not need a basket of twelve funds. For the majority of investors, one well-chosen ETF is the entire portfolio.
The one-ticket all-in-one ETFs (start here)
Asset-allocation ETFs hold a globally diversified mix and rebalance themselves. Pick one based on how much volatility you want:
| ETF | Mix | Best for |
|---|---|---|
| XEQT / VEQT | 100% equity | Long horizons (10+ years), maximum growth |
| XGRO / VGRO | ~80% equity / 20% bonds | Most investors wanting some stability |
| XBAL / VBAL | ~60% equity / 40% bonds | Shorter horizons or lower risk tolerance |
Can't decide between the two all-equity options? We compare them head-to-head in XEQT vs VEQT. The short version: either is excellent.
One fund really is enough
US index ETFs (popular satellites)
VFV and ZSPtrack the S&P 500 and have delivered strong returns. But they're 100% US large-cap — no Canadian, international, or small-cap exposure. They're fine as a satellite alongside a diversified core, but as a sole holding they concentrate your bets on one country.
Low-cost core building blocks (for DIY allocators)
If you'd rather build your own allocation, the classic low-MER pieces are a Canadian equity ETF, a US equity ETF, an international/emerging ETF, and a bond ETF. It's more work and more rebalancing for an outcome very close to a one-ticket fund — which is why most people are better served by the all-in-one.
The factor that matters most
Whatever you pick, keep the MER low. As we show in the hidden cost of MERs, fees are the one return factor entirely within your control — and a difference of a couple percent compounds into six figures over a career. Check any fund's all-in cost with the ETF fee calculator.
Where to buy
All of these trade commission-free at Wealthsimple, with fractional shares so your whole contribution is invested. Open a TFSA or RRSP, buy your pick, automate it, and get on with your life.
