The Canadian equity landscape has been dominated by several key developments over the last year or so as the market reached all-time highs. For one, gold and silver reached unprecedented highs, driving exceptional performance in the materials sector. This “golden tide” significantly benefited both ETFs we cover below.
The Bank of Canada implemented monetary policy easing, cutting rates to 2.25% in October 2025. This accommodative stance supported dividend-paying stocks.
All in all, the TSX’s record-breaking performance has been especially driven by materials, technology, and financial sector strength.
One of the two ETFs below represents a superior investment choice for Canadian equity exposure. It provides concentrated exposure to Canada’s highest-quality, most liquid companies through the S&P/TSX 60 Index. Its exceptionally low 0.18% management expense ratio (MER) compares very favourably to the other fund’s 0.50% expense ratio. A lower MER delivers significant cost savings that compound over time and enhances long-term returns.
ISHARES MSCI CANADA INDEX FUND (New York symbol EWC; buy or sell through brokers; ca.ishares.com) holds the stocks in the Morgan Stanley Capital International Canada Index.
The fund has a 0.50% MER and has a yield of 1.4%. It began trading for investors on March 12, 1996.
The ETF’s top holdings are Royal Bank, 7.8%; TD Bank, 5.5%; Shopify, 5.3%; Enbridge, 4.0%; Agnico Eagle Mines, 3.9%; Bank of Montreal, 3.4%; Canadian Natural Resources, 3.2%; CIBC, 3.1%; Bank of Nova Scotia, 3.0%; Brookfield Corp., 3.0%; and Barrick Mining, 2.8%.
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S&P/TSX 60 Index ETF (see below). You’ll pay about a third as much in management fees, while holding essentially the same stocks.
iShares is a better choice for your hard-earned money
ISHARES S&P/TSX 60 INDEX ETF (Toronto symbol XIU; buy or sell through brokers; ca.ishares.com) is a good low-fee way to buy the top companies listed on the TSX. Specifically, the fund’s holdings represent the S&P/TSX 60 Index. It focuses on the 60 largest, most heavily traded stocks on the exchange.
The ETF began trading on September 28, 1999. Investors pay an MER of just 0.18%. The units give you a 2.3% yield.
The S&P/TSX 60 Index mostly consists of high-quality companies. However, it must ensure that all sectors are represented, so it holds a few companies we would not include.
The quality of the ETF’s holdings should drive your future gains: its top stocks are Royal Bank, 8.4%; TD Bank, 5.9%; Shopify, 5.7%; Enbridge, 4.2%; Agnico Eagle Mines, 4.1%; Bank of Montreal, 3.7%; Canadian Natural Resources, 3.4%; CIBC, 3.3%; Brookfield Corp., 3.2%; Bank of Nova Scotia, 3.2%; and Barrick Mining, 2.8%.
Recommendation in Canadian Wealth Advisor: iShares MSCI Canada Index Fund is a sell in favour of the iShares S&P/TSX 60 Index ETF.
