ETFs
Exchange traded funds trade on stock exchanges, just like stocks. Investors can buy them on margin, or sell them short. The best exchange-traded funds offer well-diversified, tax-efficient portfolios with exceptionally low management ETF fees. They are also very liquid.
Investors use ETFs in a variety of ways, and some investors work only with ETFs and no other type of investment in portfolio creation.
An amazing aspect of ETFs is their diversity. Some investors may create an entire portfolio solely from a few well-diversified ETFs.
ETFs trade on stock exchanges, just like stocks. That’s different from mutual funds, which you can only buy at the end of the day at a price that reflects the fund’s value at the close of trading.
Prices of ETFs are quoted in newspaper stock tables and online. You pay brokerage commissions to buy and sell them, but their low management fees give them a cost advantage over most mutual funds.
As well, shares are only added or removed when the underlying index changes. As a result of this low turnover, you won’t incur the regular capital gains taxes generated by the yearly distributions most conventional mutual funds pay out to unitholders.
ETFs have a place in every investor’s portfolio, at TSI Network we also recommend using our three-part Successful Investor strategy:
- Invest mainly in well-established companies;
- Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; the Consumer sector; Finance; Utilities);
- Downplay or avoid stocks in the broker/media limelight.
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ETFs Library Archives
Investors who are interested in receiving regular income streams from their portfolios have a wide range of ETFs to choose from.
However, the stock selection strategies followed by ETFs vary widely, and some have more consistent payout histories than others.
Below, we look at three ETFs that focus on dividend-paying companies. The Supplement on page 30 provides more information on the dividend growth and performance of a select group of dividend-focused ETFs.
However, the stock selection strategies followed by ETFs vary widely, and some have more consistent payout histories than others.
Below, we look at three ETFs that focus on dividend-paying companies. The Supplement on page 30 provides more information on the dividend growth and performance of a select group of dividend-focused ETFs.
BMO S&P US MID CAP 400 ETF $52.09 (Toronto symbol ZMID, TSINetwork ETF Rating: Aggressive; Market cap: $303.4 million) invests in medium-sized U.S. companies. It tracks the S&P 400 Mid-Cap Index.
The largest industry allocations are to Industrials (22% of assets), Technology (16%), Financials (16%), Consumer Discretionary (12%), Health Care (9%), Real Estate (7%), and Basic Materials (5%).
The ETF holds 400 companies with only 7.0% of the assets allocated to the top 10 stocks. Top holdings include Ciena Corp. (Technology, 1.0%), Coherent Corp. (Technology, 0.9%), United Therapeutics (Healthcare, 0.7%), Caseys General Store (Consumer, 0.6%), Illumina (Healthcare, 0.6%), Pure Storage (Technology, 0.6%), Curtis-Wright Group (Industrials, 0.6%), RB Global (Industrials, 0.6%), Royal Gold (Basic Materials, 0.6%), and Transunion (Financials, 0.5%).
The largest industry allocations are to Industrials (22% of assets), Technology (16%), Financials (16%), Consumer Discretionary (12%), Health Care (9%), Real Estate (7%), and Basic Materials (5%).
The ETF holds 400 companies with only 7.0% of the assets allocated to the top 10 stocks. Top holdings include Ciena Corp. (Technology, 1.0%), Coherent Corp. (Technology, 0.9%), United Therapeutics (Healthcare, 0.7%), Caseys General Store (Consumer, 0.6%), Illumina (Healthcare, 0.6%), Pure Storage (Technology, 0.6%), Curtis-Wright Group (Industrials, 0.6%), RB Global (Industrials, 0.6%), Royal Gold (Basic Materials, 0.6%), and Transunion (Financials, 0.5%).
One of the key attractions of exchange-traded funds is their generally lower fees compared to mutual funds. In addition, as more competitors entered the market, fees on many ETFs continue to drop.
One of the older U.S.-based funds with a large asset base and higher fees is the IShares MSCI Canada ETF $56.62 (New York symbol EWC). This fund started in 1996 and invests in larger Canadian companies. It has an asset base of $4.1 billion U.S. and an MER of 0.50%. The units yield 1.4%.
Another similar fund with a large asset base is the IShares S&P/TSX 60 ETF, $48.68 (Toronto symbol XIU). This ETF started up in 1990. It tracks the S&P/TSX 60 Index and has assets of $21.1 billion under management.
One of the older U.S.-based funds with a large asset base and higher fees is the IShares MSCI Canada ETF $56.62 (New York symbol EWC). This fund started in 1996 and invests in larger Canadian companies. It has an asset base of $4.1 billion U.S. and an MER of 0.50%. The units yield 1.4%.
Another similar fund with a large asset base is the IShares S&P/TSX 60 ETF, $48.68 (Toronto symbol XIU). This ETF started up in 1990. It tracks the S&P/TSX 60 Index and has assets of $21.1 billion under management.
Companies deploy robots for a growing number of applications in healthcare, industrial manufacturing, military, automotive and commercial settings. Labour shortages and the push to lower production costs are the biggest drivers of that growth, although the need to shield workers from repetitive or dangerous tasks is also another factor.
Here we discuss two ETFs that hold companies involved in the robotics industry. The supplement on page 29 provides more information on today’s varied applications.
Here we discuss two ETFs that hold companies involved in the robotics industry. The supplement on page 29 provides more information on today’s varied applications.
Below, we highlight an ETF that’s soaring for our subscribers. The iShares MSCI Chile ETF has almost doubled since the start of 2025, and its units are now at all-time highs. Those gains reflect the soaring price for copper, one of Chile’s top exports. Still, they also reflect the outcome of the December 2025 presidential election. As a candidate, Jose Antonio Kast pledged to boost copper output. That remains part of the pro-mining policy changes he is expected to introduce, including making permits easier to obtain.
You Can See Our Exchange-Traded Funds Portfolio For February 2026 Here.
ETFs in brief
Exchange-traded funds are set up to mirror the performance of a stock-market index or sub-index. They hold a more or less fixed selection of securities that represent the holdings of that index or sub-index and will allow the fund to “track” its performance.
The MER (Management Expense Ratio) is generally much lower on traditional ETFs than on conventional mutual funds. That’s because most traditional ETFs take a much simpler approach to investing. Instead of actively managing clients’ investments, ETF providers invest so as to mirror the holdings and performance of a particular stock-market index.
ETFs practice this “passive” fund management style, in contrast to the “active” management that conventional mutual funds traditionally provide at much higher costs.
ETFs in brief
Exchange-traded funds are set up to mirror the performance of a stock-market index or sub-index. They hold a more or less fixed selection of securities that represent the holdings of that index or sub-index and will allow the fund to “track” its performance.
The MER (Management Expense Ratio) is generally much lower on traditional ETFs than on conventional mutual funds. That’s because most traditional ETFs take a much simpler approach to investing. Instead of actively managing clients’ investments, ETF providers invest so as to mirror the holdings and performance of a particular stock-market index.
ETFs practice this “passive” fund management style, in contrast to the “active” management that conventional mutual funds traditionally provide at much higher costs.
Here’s a more in-depth look at the ETFs we looked at on pages 11 to 14 and their strategies.
A focus on dividends will pays off
Shares Core MSCI Canadian Quality Dividend ETF (Toronto symbol XDIV)
Stocks involved in artificial intelligence have dominated the investing landscape over the past two years, while dividend-paying companies have had less momentum. Nonetheless, it pays to not forget the attractions of high-quality dividend-paying stocks. Consider the following:
A focus on dividends will pays off
Shares Core MSCI Canadian Quality Dividend ETF (Toronto symbol XDIV)
Stocks involved in artificial intelligence have dominated the investing landscape over the past two years, while dividend-paying companies have had less momentum. Nonetheless, it pays to not forget the attractions of high-quality dividend-paying stocks. Consider the following:
This month, we highlight two new funds from asset manager Global X. The first claims to be a world first—a covered call strategy on copper producers. The second is an ETF that holds Hong Kong-listed Chinese technology companies.
Global X Copper Producer Equity Covered Call ETF $24.26 (Toronto symbol CPCC) invests in an ETF that holds copper producers, as well investing in individual copper miners.
The ETF manager then sells call options against the portfolio holdings in order to generate additional income for the ETF.
Global X Copper Producer Equity Covered Call ETF $24.26 (Toronto symbol CPCC) invests in an ETF that holds copper producers, as well investing in individual copper miners.
The ETF manager then sells call options against the portfolio holdings in order to generate additional income for the ETF.
The two top holdings in the iShares MSCI South Korea ETF, Samsung Electronics and SK Hynix, are both among the top global manufacturers of memory semiconductors, although Samsung is also a major player in the mobile phone and consumer electronics market. Over the past five years, the stock price performances of the two companies were vastly different, with Hynix up by 394% compared to a 48% gain for Samsung.
Hynix has done well over the past five years, raising its revenue by 164% and its earnings per share by 638% while maintaining high profit margins—although the company did struggle in 2023 when semiconductor memory prices dropped sharply. The company’s success is mainly due to its dominant position in the high-bandwidth memory (HBM) market. That’s where Hynix has a global market share of about 70%, with Nvidia one of its key customers. The HBM chips are used in AI servers and are currently in demand, with high selling prices and profit margins.
Hynix has done well over the past five years, raising its revenue by 164% and its earnings per share by 638% while maintaining high profit margins—although the company did struggle in 2023 when semiconductor memory prices dropped sharply. The company’s success is mainly due to its dominant position in the high-bandwidth memory (HBM) market. That’s where Hynix has a global market share of about 70%, with Nvidia one of its key customers. The HBM chips are used in AI servers and are currently in demand, with high selling prices and profit margins.
When we last wrote about South Korea in late 2024, we concluded that there were excellent opportunities among high-quality South Korean companies. Since that time, our recommendation of the iShares MSCI South Korea ETF has gained a whopping 75.5% for our subscribers! Meanwhile, many of those same stocks still trade at attractive valuations. (For more on that, see box next page.)
Here is an ETF that provides exposure to the top South Korean publicly listed companies.
Here is an ETF that provides exposure to the top South Korean publicly listed companies.