Exchange-traded funds, or ETFs, are often low-cost instruments for tracking popular indexes or leveraging experienced managers’ choices to beat the market. The best serve as low-cost building blocks in a portfolio, and unlike open-end mutual funds, all ETFs are traded throughout the day on an exchange.
In July 2026, the worst-performing ETFs included global small/mid cap equity fund BMO Clean Energy Index ETF ZCLN and US equity fund iShares MSCI USA Momentum Factor Index ETF XMTM. Data in this article is sourced from Morningstar Direct.
Screening for the Worst-Performing ETFs
When evaluating ETFs, investors should focus on long-term returns across multiple years and market cycles. However, short-term returns can provide valuable information about biases within strategies.
We screened equity, allocation, and fixed income funds that trade within Canada for those with at least C$10 million in total assets. We narrowed the list to ETFs with parent pillars for their Morningstar Medalist Ratings of average or above, meaning our analysts believe they’re backed by industry-standard asset management companies. We also excluded exchange-traded notes.
Within our list, two funds fell into the US equity category, where the average name rose 2.27% in July.
The 10 Worst-Performing ETFs for July 2026
- BMO Clean Energy Index ETF ZCLN
- iShares MSCI USA Momentum Factor Index ETF XMTM
- Harvest Clean Energy ETF HCLN
- Middlefield Innovation Dividend ETF MINN
- iShares MSCI Emerging Markets ex China Index ETF XEMC
- Vanguard Global Momentum Factor ETF VMO
- TD Active Global Enhanced Dividend ETF TGED
- CI Emerging Markets Alpha ETF CIEM.U
- Dynamic Active US Dividend ETF DXU
- Franklin Innovation Fund FINO
Metrics for the Worst-Performing ETFs
BMO Clean Energy Index ETF
- : ★Morningstar Rating
- : 0.39%Expense Ratio
- : Global Small/Mid Cap EquityMorningstar Category
The worst-performing ETF in July was the C$78.4 million BMO Clean Energy Index ETF. The passively managed BMO ETF declined 15.16%, underperforming the average global small/mid cap equity fund, which gained 2.49%. Over the last year, the fund has climbed 34.96%, outperforming the 22.03% gain on funds in its category, placing it in the 8th percentile for the period.
The Neutral-rated BMO Clean Energy Index ETF launched in January 2021.
iShares MSCI USA Momentum Factor Index ETF
- Morningstar Rating: ★★★★★
- Expense Ratio: 0.31%
- Morningstar Category: US Equity
The C$31.1 million iShares MSCI USA Momentum Factor Index ETF was the second-worst-performing ETF in July, with a 13.60% loss. The passively managed BlackRock ETF lagged the 2.27% gain on the average fund in Morningstar’s US equity category for the month. Over the last year, the fund has gained 26.59%, outperforming the 22.18% gain on funds in its category, placing it in the 8th percentile for the period.
The Gold-rated iShares MSCI USA Momentum Factor Index ETF launched in September 2019.
Harvest Clean Energy ETF
- Morningstar Rating: ★
- Expense Ratio: 0.69%
- Morningstar Category: Global Small/Mid Cap Equity
The third-worst-performing ETF in July was the C$19.6 million Harvest Clean Energy ETF. The actively managed Harvest Portfolios ETF declined 12.66%, underperforming the average global small/mid cap equity fund, which gained 2.49%. Over the last year, the fund has climbed 13.30%, underperforming the 22.03% gain on funds in its category, placing it in the 59th percentile for the period.
The Neutral-rated Harvest Clean Energy ETF launched in January 2021.
Middlefield Innovation Dividend ETF
- Morningstar Rating: ★★★★★
- Expense Ratio: 1.28%
- Morningstar Category: Global Equity
The C$114.8 million Middlefield Innovation Dividend ETF ranked fourth for the month, falling 11.36%. The Middlefield ETF, which is actively managed, lagged the 2.27% gain on the average global equity fund. Over the past year, the fund has risen 33.67%, outperforming the 21.29% gain on funds in its category, placing it in the 2nd percentile for the period.
The Bronze-rated Middlefield Innovation Dividend ETF launched in March 2018.
iShares MSCI Emerging Markets ex China Index ETF
- Morningstar Rating: ★★★★★
- Expense Ratio: 0.31%
- Morningstar Category: Emerging Markets Equity
The C$141.2 million iShares MSCI Emerging Markets ex China Index ETF was the fifth worst-performing ETF in July, with a 10.96% loss. The passively managed BlackRock ETF lagged the 2.38% gain on the average fund in Morningstar’s emerging markets equity category for the month. Over the last year, the fund has gained 51.81%, outperforming the 49.20% gain on funds in its category, placing it in the 6th percentile for the period.
The Neutral-rated iShares MSCI Emerging Markets ex China Index ETF launched in February 2023.
Vanguard Global Momentum Factor ETF
- Morningstar Rating: ★★★★★
- Expense Ratio: 0.38%
- Morningstar Category: Global Equity
The sixth-worst-performing ETF in July was the C$494.8 million Vanguard Global Momentum Factor ETF. The actively managed Vanguard ETF declined 10.77%, underperforming the average global equity fund, which gained 2.27%. Over the last year, the fund has climbed 30.00%, outperforming the 21.29% gain on funds in its category, placing it in the 5th percentile for the period.
The Gold-rated Vanguard Global Momentum Factor ETF launched in June 2016.
TD Active Global Enhanced Dividend ETF
- Morningstar Rating: ★★★★★
- Expense Ratio: 0.71%
- Morningstar Category: Global Equity
The C$1.9 billion TD Active Global Enhanced Dividend ETF was the seventh-worst-performing ETF in July, with a 9.86% loss. The actively managed TD ETF lagged the 2.27% gain on the average fund in Morningstar’s global equity category for the month. Over the last year, the fund has gained 17.63%, underperforming the 21.29% gain on funds in its category, placing it in the 48th percentile for the period.
The Gold-rated TD Active Global Enhanced Dividend ETF launched in May 2019.
CI Emerging Markets Alpha ETF
- Morningstar Rating: ★★★★★
- Expense Ratio: 1.07%
- Morningstar Category: Emerging Markets Equity
The eighth-worst-performing ETF in July was the C$151.6 million CI Emerging Markets Alpha ETF. The actively managed CI Investments ETF declined 8.56%, underperforming the average emerging markets equity fund, which gained 2.38%. Over the last year, the fund has climbed 45.64%, underperforming the 49.20% gain on funds in its category, placing it in the 15th percentile for the period.
The Bronze-rated CI Emerging Markets Alpha ETF launched in August 2021.
Dynamic Active US Dividend ETF
- Morningstar Rating: ★★★★
- Expense Ratio: 0.81%
- Morningstar Category: US Equity
The C$99.2 million Dynamic Active US Dividend ETF ranked ninth for the month, falling 8.50%. The Dynamic ETF, which is actively managed, lagged the 2.27% gain on the average US equity fund. Over the past year, the fund has risen 21.88%, performing roughly in line with the 22.18% gain on funds in its category, placing it in the 19th percentile for the period.
The Bronze-rated Dynamic Active US Dividend ETF launched in January 2017.
Franklin Innovation Fund
- Morningstar Rating: ★★★★
- Expense Ratio: 0.9%
- Morningstar Category: Global Equity
The C$28 million Franklin Innovation Fund was the tenth-worst-performing ETF in July, with an 8.25% loss. The actively managed Franklin Templeton ETF lagged the 2.27% gain on the average fund in Morningstar’s global equity category for the month. Over the last year, the fund has gained 10.59%, underperforming the 21.29% gain on funds in its category, placing it in the 79th percentile for the period.
The Silver-rated Franklin Innovation Fund launched in February 2021.
The Best ETFs: More Ideas to Consider
- Read the latest articles on ETFs.
- Use the ETF screener to find the best ETFs according to your specific criteria. You can search for funds based on their fees, Morningstar Medalist Ratings, manager tenures, and more.
