The Best Canadian Equity ETFs to Buy

Exchange-traded funds focusing on Canadian stocks are the core of most investor portfolios. To find the best options, we screened the Canadian stock ETFs covered by Morningstar analysts for those they believe stand the best chance of outperforming.

The 8 Best Canadian Stock ETFs to Buy Now

Funds in this category must invest at least 90% of their equity holdings in securities domiciled in Canada, and their average market capitalization must be greater than the Canadian small/mid cap threshold.

We screened for funds with

of Gold and 100% analyst coverage. All the ETFs on the list fall into the Canadian equity and have at least C$100 million in assets. Of the eight funds that made it through the screen, seven are index-based strategies. All data is as of May 29.

• BMO S&P/TSX 60 Index ETF ZIU
• BMO S&P/TSX Capped Composite Index ETF ZCN
• Franklin FTSE Canada All Cap Index ETF FLCD
• Vanguard FTSE Canada All Cap Index ETF VCN
• Vanguard FTSE Canada Index ETF VCE
• iShares Core S&P/TSX Capped Composite Index ETF XIC
• iShares MSCI Min Vol Canada Index ETF XMV
• iShares S&P/TSX 60 Index ETF XIU

Morningstar expects these funds to outperform their peers over a full market cycle. Though they fall into the same category, they may practice different strategies and behave differently. Investors need to do their homework to understand exactly what a particular fund invests in before buying. Here’s a quick look at each of the best Canadian equity ETFs.

BMO S&P/TSX 60 Index ETF

• Index Fund: Yes
• MER: 0.14
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : N/A

This C$262.1 million fund has climbed 31.97% over the past year, outperforming the average fund in its category, which rose 27.49%. The BMO fund launched in October 2023.

This fund fully replicates the S&P/TSX 60 Index. S&P builds the index to represent the Canadian large-cap market as accurately as it can. A committee starts with a pool of stocks that meet basic liquidity requirements, and it selects 60 stocks that collectively mirror the large-cap market. That doesn’t always mean the largest 60 stocks, though the committee doesn’t leave too many fingerprints on the index.

This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Market-cap weighting channels the market’s collective view on each holding’s relative value, allowing the fund to coast on the research of the crowd without running up its own expenses. Buffers make it more difficult for a stock to exit this portfolio once it has been added, promoting low turnover. The index rebalances quarterly, but the committee has discretion to add or subtract constituents between rebalance dates.

This fund’s relatively large market-cap orientation is its defining trait. Filtering out small-cap stocks and weighting stocks by market cap jointly place more emphasis on the largest stocks in the market. Investors should expect this fund to measure up best when mega-cap stocks like Royal Bank of Canada, Shopify, and Toronto-Dominion Bank—the fund’s top three holdings as of August 2025—pace the overall market.

Otherwise, the shape of this portfolio approximates the average Canada-equity fund. The portfolios trade at similar valuations. This fund’s end-August 2025 stake in financials exceeded the category norm by 5 percentage points, but it sported a similar sector allocation elsewhere. Targeting the largest 90% of the market gives this fund access to most of the opportunity set available to its peers. That should enhance the impact of its low fee over the long term.

At roughly 60 holdings, this fund is leaner than most of its category rivals. It’s also top-heavy owing to its limited holdings list and market-cap weighting. That said, the stocks that sit atop this portfolio tend to be worthy of their rich valuations. Nine of the top 10 holdings sported wide or narrow Morningstar Economic Moat Ratings at the end of August 2025 that reflect their financial health and competitive advantages.

Note: This share class’ Process Pillar rating and analysis are inherited from an analyst-covered passive share class which tracks the same index: iShares S&P/TSX 60 ETF (SecID: FOUSA06AYW).

Read Morningstar’s full report on the BMO S&P/TSX 60 Index ETF.

BMO S&P/TSX Capped Composite Index ETF

• Index Fund: Yes
• MER: 0.06
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★

This C$16.7 billion fund has climbed 35.81% over the past year, outperforming the average fund in its category, which rose 27.49%. The BMO fund, launched in May 2009, has climbed 23.74% over the past three years and 15.09% over the past five.

BMO S&P/TSX Capped Composite ETF offers broad exposure to the Canadian stock market at a low price, a simple formula that few of its peers have been able to beat in the long run.

Tracking nearly the entire Canadian stock market makes this a well-diversified portfolio. It normally tallies around 230 holdings, the top 10 of which represented between 35% and 39% of the portfolio over the past 10 years. That’s a higher share than the category average but on par with its Morningstar Canada Index category benchmark. Sweeping in mid- and small-cap stocks can present an edge when large caps fall out of favor.

This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Market-cap weighting channels the market’s collective view on the relative value of each holding, allowing the fund to coast on the research of the crowd without incurring a lot of expenses. It also requires little turnover, a benefit that’s enhanced further by index buffers that are designed to cut back on trading and the costs that come with it.

The shape of this index fund looks a lot like the average portfolio in the Canadian equity Morningstar Category. Its average holding is a bit larger than the category average, but the portfolios sport nearly identical sector compositions and value-growth orientations. Mirroring the category norm indicates that this fund captures the full opportunity set available to its active peers. It also means that the fund maximizes the impact of its cost advantage, a reliable engine for sound category-relative performance.

Sector-level concentration creeps into this portfolio. Heavy stakes in financials (33% of assets as of July 2025) and energy (16%) tend to soak up about half the portfolio. These biases reflect the composition of the Canadian market rather than a flaw in its target index. Still, the fund can suffer when those sectors, or certain industries within them, face challenges.

The fund outperformed its average peer by 1.51 percentage points annualized over the past 10 years through August 2025. The fund’s return fluctuated more than its average peer during that period, but its risk-adjusted performance was still higher. Low fees, low turnover, and little cash allow the fund to capture the Canadian stock market’s performance with minimal drag.

Read Morningstar’s full report on the BMO S&P/TSX Capped Composite Index ETF.

Franklin FTSE Canada All Cap Index ETF

• Index Fund: Yes
• MER: 0.06
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★

This C$254.2 million fund has climbed 34.70% over the past year, outperforming the average fund in its category, which rose 27.49%. The Franklin Templeton fund, launched in February 2019, has climbed 23.75% over the past three years and gained 15.17% over the past five years.

The FTSE Canada All Cap Domestic Index underpins this fund. The benchmark absorbs the stocks that represent the top 98% of the Canadian stock market’s capitalization after removing those that fail to meet basic liquidity and size requirements. It weights its holdings by market cap and reconstitutes each March and September. Liquidity and size buffers make it easier for current constituents to stick in the portfolio, a measure that dials back turnover and the requisite transaction costs.

This fund mirrors the shape of the Canadian stock market and its average peer in the Canada equity category. The fund’s market-cap weighting gives it a slightly larger market-cap orientation than the category average, but the portfolios trade at nearly identical valuations. Their sector allocation is right in line, too. That entails a heavy dose of financials (34% of assets as of August 2025) and energy stocks (16%). Routinely stashing over half its portfolio in those sectors presents some concentration risk, but it reflects the state of the market and does not distinguish the fund from its category peers.

Canada’s largest companies headline this portfolio. Royal Bank of Canada, Shopify, and Toronto-Dominion Bank held down the top three spots as of August 2024. Market-cap weighting can precipitate concentration—the top 10 holdings normally represent 35% to 41% of assets—but the market’s largest companies normally earn their valuations for good reasons. Nine of the top 10 holdings sported wide or narrow Morningstar Economic Moat Ratings, which reflect their financial health and competitive advantages, as of August 2025.

Note: This share class’ Process Pillar rating and analysis are inherited from an analyst-covered passive share class which tracks the same index: Vanguard FTSE Canada All Cap ETF (SecID: F00000QA9G).

Read Morningstar’s full report on the Franklin FTSE Canada All Cap Index ETF.

Vanguard FTSE Canada All Cap Index ETF

• Index Fund: Yes
• MER: 0.06
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★

The C$16 billion fund has gained 34.76% over the past year, while the average fund in its category is up 27.49%. The Vanguard fund, which launched in August 2013, has climbed 23.79% over the past three years and gained 15.19% over the past five years.

Vanguard FTSE Canada All Cap ETF offers broad exposure to the Canadian stock market at a low price, a simple formula that few of its peers have been able to beat in the long run.

Tracking nearly the entire Canadian stock market makes this a well-diversified portfolio. It normally tallies around 200 holdings, the top 10 of which represented between 35% and 41% of the portfolio over the past 10 years. That’s a higher share than the category average but on par with its Morningstar Canada Index category benchmark. Sweeping in mid- and small-cap stocks can present an edge when large caps fall out of favor.

This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Its market-cap weighting channels the market’s collective view on the relative value of each holding, allowing the fund to coast on the research of the crowd without incurring a lot of expenses. It also requires little turnover, a benefit that’s enhanced further by index buffers that are designed to cut back on trading and the costs that come with it.

The shape of this index fund looks a lot like the average portfolio in the Canadian equity Morningstar Category. Its average holding is a bit larger than the category average, but the portfolios sport nearly identical sector compositions and value-growth orientations. Mirroring the category norm indicates that this fund captures the full opportunity set available to its active peers. It also means that the fund maximizes the impact of its cost advantage, a reliable engine for sound category-relative performance.

Sector-level concentration creeps into this portfolio. Heavy stakes in financials (34% of assets as of August 2025) and energy (16%) tend to soak up about half the portfolio. These biases reflect the composition of the Canadian market rather than a flaw in its target index. Still, the fund can suffer when those sectors, or certain industries within them, face challenges.

The fund outperformed its average peer by 1.43 percentage points annualized over the past 10 years through August 2025. The fund’s return fluctuated more than its average peer during that period, but its risk-adjusted performance was still higher. Low fees, low turnover, and little cash allow the fund to capture the Canadian stock market’s performance with minimal drag.

Read Morningstar’s full report on the Vanguard FTSE Canada All Cap Index ETF.

Vanguard FTSE Canada Index ETF

• Index Fund: Yes
• MER: 0.06
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★★

Over the past year, the Vanguard fund rose 32.04%, while the average fund in its category rose 27.49%. The fund, launched in November 2011, has climbed 23.27% over the past three years and 15.17% over the past five.

Vanguard FTSE Canada ETF offers broad exposure to the Canadian stock market at a low price, a simple formula that few of its peers have been able to beat in the long run.

This fund sweeps in stocks representing the largest 86% of the market, a scope that has admitted between 48 and 69 holdings over the past 10 years. The top 10 of those represented between 45% and 52% of the portfolio in the same period. That’s a higher share than the category average, but the pedigree of the franchises atop the portfolio dials back firm-specific risk.

This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Its market-cap weighting channels the market’s collective view on the relative value of each holding, allowing the fund to coast on the research of the crowd without incurring a lot of expenses. It also requires little turnover, a benefit that’s enhanced further by index buffers that are designed to cut back on trading and the costs that come with it.

This index fund looks a lot like the average portfolio in the Canadian equity Morningstar Category, except for a larger market-cap orientation and a larger portion of financials stocks compared with peers. The portfolios sport similar value-growth bents. Mimicking the category norm indicates that this fund captures most of the opportunity set available to its active peers. That amplifies the impact of its cost advantage, a reliable engine for category-relative performance.

Sector-level concentration creeps into this portfolio. Heavy stakes in financials (41% of assets as of August 2025) and energy (17%) tend to soak up about half the portfolio. These biases reflect the composition of the Canadian market rather than a flaw in its target index. Still, the fund can suffer when those sectors, or certain industries within them, face challenges.

The fund outperformed its average peer by 1.78 percentage points annualized over the past 10 years through August 2025. The fund’s return fluctuated more than its average peer during that period, but its risk-adjusted performance was still higher. Low fees, low turnover, and little cash allow the fund to capture the Canadian stock market’s performance with minimal drag.

Read Morningstar’s full report on the Vanguard FTSE Canada Index ETF.

iShares Core S&P/TSX Capped Composite Index ETF

• Index Fund: Yes
• MER: 0.06
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★

Over the past year, the BlackRock fund rose 35.83%, while the average fund in its category rose 27.49%. The fund, launched in February 2001, has climbed 23.74% over the past three years and 15.09% over the past five.

IShares Core S&P/TSX Capped Composite ETF offers broad exposure to the Canadian stock market at a low price, a simple formula that few of its peers have been able to beat in the long run.

Tracking nearly the entire Canadian stock market makes this a well-diversified portfolio. It normally tallies around 230 holdings, the top 10 of which represented between 35% and 39% of the portfolio over the past 10 years. That’s a higher share than the category average but on par with its Morningstar Canada Index category benchmark. Sweeping in mid- and small-cap stocks can present an edge when large caps fall out of favor.

This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Market-cap weighting channels the market’s collective view on the relative value of each holding, allowing the fund to coast on the research of the crowd without incurring a lot of expenses. It also requires little turnover, a benefit that’s enhanced further by index buffers that are designed to cut back on trading and the costs that come with it.

The shape of this index fund looks a lot like the average portfolio in the Canadian equity Morningstar Category. Its average holding is a bit larger than the category average, but the portfolios sport nearly identical sector compositions and value-growth orientations. Mirroring the category norm indicates that this fund captures the full opportunity set available to its active peers. It also means that the fund maximizes the impact of its cost advantage, a reliable engine for sound category-relative performance.

Sector-level concentration creeps into this portfolio. Heavy stakes in financials (32% of assets as of August 2025) and energy (16%) tend to soak up about half the portfolio. These biases reflect the composition of the Canadian market rather than a flaw in its target index. Still, the fund can suffer when those sectors, or certain industries within them, face challenges.

The fund outperformed its average peer by 1.51 percentage points annualized over the past 10 years through August 2025. The fund’s return fluctuated more than its average peer during that period, but its risk-adjusted performance was still higher. Low fees, low turnover, and little cash allow the fund to capture the Canadian stock market’s performance with minimal drag.

Read Morningstar’s full report on the iShares Core S&P/TSX Capped Composite Index ETF.

iShares MSCI Min Vol Canada Index ETF

• Index Fund: Yes
• MER: 0.34
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★

This C$414.4 million fund has climbed 20.25% over the past year, underperforming the average fund in its category, which rose 27.49%. The BlackRock fund, launched in July 2012, has climbed 18.60% over the past three years and 13.84% over the past five.

IShares MSCI Minimum Volatility Canada ETF is a well-designed low-volatility strategy whose ability to weather drawdowns should continue to drive a strong risk/reward profile.

The MSCI Canada Minimum Volatility Index, the benchmark this fund fully replicates, follows a meticulous set of instructions. It uses an optimizer to carve out a defensive portfolio from the MSCI Canada Index, a broad collection of large- and mid-cap Canadian stocks. The optimizer considers stocks’ individual volatility and how their performance interrelates with other holdings. That holistic view favors steady operators, but it also sweeps in some turbulent stocks that dance to their own tune. Those free spirits can lower volatility further if they continue to zig when the rest of the portfolio zags.

Comprehensive portfolio constraints improve this strategy, even if they moderately diminish its defensive chops. The fund ties its stock-, sector-, and country-level allocations to the parent index. These constraints reduce concentration and ensure that sectors like consumer defensive and utilities, favorites among simpler low-volatility strategies, don’t overrun the portfolio. Controlling for risk factors like value and momentum prevents incidental style or factor bets. These guardrails may prevent the fund from building the most defensive portfolio possible, but they make sure that no unintended bets compromise the low-volatility focus. That’s a worthy trade-off.

The fund has delivered on its goals so far. Its returns were 17% less volatile than the MSCI Canada Index from its July 2012 inception through March 2026. Investors shouldn’t expect this strategy to keep pace when the market rallies or excel every single time it wobbles, but its risk/reward profile should measure up well over the long haul. Further, low fees allow the fund to capture nearly all of the index’s returns.

Read Morningstar’s full report on the iShares MSCI Min Vol Canada Index ETF.

iShares S&P/TSX 60 Index ETF

• Index Fund: Yes
• MER: 0.18
• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★

This C$22.7 billion fund has climbed 31.98% over the past year, outperforming the average fund in its category, which rose 27.49%. The BlackRock fund, which launched in September 1999, has climbed 22.43% over the past three years and 14.47% over the past five.

IShares TSX/S&P 60 ETF offers broad exposure to the Canadian stock market at a low price, a simple formula that few of its peers have been able to beat in the long run.

S&P builds the index that this ETF tracks by targeting the 60 stocks that best represent the Canadian large- and mid-cap market. That normally covers nearly 90% of the market but still makes for a top-heavy portfolio. The 10 largest holdings represented between 43% and 52% of the portfolio over the past 10 years. That’s a higher share than the category average, but the pedigree of the franchises atop the portfolio dials back firm-specific risk.

This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Market-cap weighting channels the market’s collective view on the relative value of each holding, allowing the fund to coast on the research of the crowd without incurring a lot of expenses. It also requires little turnover, a benefit that’s enhanced further by index buffers that are designed to cut back on trading and the costs that come with it.

Save for its larger market-cap orientation, this index fund looks a lot like the average portfolio in the Canadian equity Morningstar Category. The portfolios sport similar sector compositions and value-growth bents. Mimicking the category norm indicates that this fund captures most of the opportunity set available to its active peers. That amplifies the impact of its cost advantage, a reliable engine for category-relative performance.

Sector-level concentration creeps into this portfolio. Heavy stakes in financials (37% of assets as of August 2025) and energy (16%) tend to soak up about half the portfolio. These biases reflect the composition of the Canadian market rather than a flaw in its target index. Still, the fund can suffer when those sectors, or certain industries within them, face challenges.

The fund outperformed its average peer by 1.51 percentage points annualized over the past 10 years through August 2025. The fund’s return fluctuated more than its average peer during that period, but its risk-adjusted performance was still higher. Low fees, low turnover, and little cash allow the fund to capture the Canadian stock market’s performance with minimal drag.

Read Morningstar’s full report on the iShares S&P/TSX 60 Index ETF.