ETF — Exchange-Traded Fund
An ETF (Exchange-Traded Fund) is a basket of securities (stocks, bonds) that trades like a regular stock. Combines the diversification of a mutual fund with the liquidity of a stock.
ETF Advantages
- Low fees: MER 0.03-0.30% vs 1-2% for mutual funds
- Diversification: 1 ETF = 50-9,000 securities
- Liquidity: real-time market buy/sell
- Transparency: holdings published daily
- Tax efficiency: fewer taxable distributions than mutual funds
Top Canadian ETFs 2026 (by assets)
- XEQT (iShares Core Equity ETF): 100% global equities, MER 0.20%
- VEQT (Vanguard Equity ETF): 100% global equities, MER 0.24%
- ZEQT (BMO All-Equity ETF): 100% global equities, MER 0.20%
- VFV (Vanguard S&P 500): US index, MER 0.09%
- VGRO (Vanguard Growth): 80/20 stocks/bonds, MER 0.24%
- VBAL (Vanguard Balanced): 60/40 stocks/bonds, MER 0.24%
XEQT/VEQT advantage for beginners
A single XEQT purchase gives you ~9,600 stocks across 4 markets (USA, Canada, EAFE, emerging). Maximum diversification, maximum simplicity.
Frequently Asked Questions
ETF vs mutual fund: difference?
ETF trades on market like stock (instant liquidity, low fees). Mutual fund: priced once daily, high fees (1-2%).
Which ETF to start?
XEQT or VEQT for 100% equity. VGRO 80/20 for moderate. VBAL 60/40 for conservative.
Do ETFs pay dividends?
Yes, most distribute underlying securities' dividends quarterly or monthly.
Canadian vs US ETFs for Canadians?
Canadian ETFs (XEQT) avoid US 15% withholding tax. More tax-efficient in TFSA/RRSP.
🌐 Version française: /glossaire/fnb-etf/