XEQT vs VEQT, sector ETFs, bond ETFs, REIT ETFs — and where to buy them cheapest at Questrade, National Bank Direct Brokerage, and RBC Direct Investing.
The single biggest improvement in Canadian retail investing over the past decade isn't lower fees — it's one-ticket diversified ETFs. For most Canadian investors, XEQT or VEQT is all you need.
Asset-allocation ETFs hold a globally diversified portfolio of stocks (and sometimes bonds) inside a single fund. You buy one ETF, you own thousands of companies across dozens of countries, automatically rebalanced. The argument for building your own multi-ETF portfolio has essentially collapsed — the cost difference is minimal (0.01–0.03%) and the simplicity difference is enormous.
The Canadian Couch Potato era is over for most investors. The original three-fund portfolio (XIC + XCW + ZAG) was excellent for its time. Today, XEQT does all of that in one trade at roughly the same cost. Unless you have a specific reason to tilt your portfolio (more Canadian exposure, factor investing, etc.), one-ticket funds are the rational choice.
XEQT holds four underlying iShares ETFs: Canadian equity (~24%), US equity (~44%), international equity (~24%), and emerging markets (~8%). 100% equities — no bonds. It's the right choice for investors with a long time horizon (10+ years) who want maximum growth exposure and can handle volatility.
The 0.20% MER is as low as a diversified one-ticket fund gets in Canada. On $100,000, you pay $200/year — versus $2,000+ for a balanced bank mutual fund.
VEQT is functionally nearly identical to XEQT — globally diversified, 100% equity, similar underlying holdings. The key differences: VEQT has a slightly higher Canadian equity weight (~30% vs ~24%) and costs slightly more (0.24% vs 0.20%). The Vanguard/BlackRock choice often comes down to personal preference; Vanguard's ownership structure (owned by its funds' shareholders) is philosophically distinct but practically similar in terms of costs and service.
VEQT's higher Canadian weight provides slightly more "home country" bias — a deliberate choice for Canadians who want more CAD-denominated equity exposure, lower currency risk, and more exposure to Canadian dividend stocks.
| Fund | MER | Canadian Weight | US Weight | Best For |
|---|---|---|---|---|
| XEQT | 0.20% | ~24% | ~44% | Cost-minimizers, market-weight investors |
| VEQT | 0.24% | ~30% | ~44% | Vanguard loyalists, home bias preference |
| XGRO | 0.20% | ~19% | ~35% | 80/20 equity/bond balance |
| VGRO | 0.24% | ~24% | ~35% | 80/20 with Vanguard funds |
| XBAL | 0.20% | ~17% | ~31% | 60/40 balanced; approaching retirement |
One-ticket ETFs give you market-weight exposure. Sector ETFs let you tilt toward specific industries. Common reasons: overweighting defensives before a potential recession, or adding Canadian financials for dividend income.
| Sector | ETF | MER | Why Use It |
|---|---|---|---|
| Canadian Financials (banks) | ZEB (BMO S&P/TSX Equal Weight Banks) | 0.28% | High dividend yield; equal-weight avoids over-concentration in TD/RBC |
| Canadian Utilities | ZUT (BMO Equal Weight Utilities) | 0.55% | Defensive, rate-sensitive; useful in recession positioning |
| Canadian Energy | XEG (iShares S&P/TSX Capped Energy) | 0.61% | Inflation hedge, commodity exposure |
| Canadian Real Estate | ZRE (BMO Equal Weight REITs) | 0.61% | Inflation protection, income generation |
| US Technology | TEC (TD Global Technology Leaders) | 0.39% | Growth tilt; US tech sector via Canadian-listed ETF (avoids US withholding in RRSP context) |
| Global Clean Energy | ICLN (US-listed) or ZSUS | 0.40–0.46% | ESG/energy transition exposure |
Sector ETF caution: Sector tilts add concentration risk and require rebalancing discipline. If you don't have a specific reason for a sector tilt, the broad all-in-one ETFs (XEQT/VEQT) provide better diversification at lower cost. Sector timing is notoriously difficult.
Broad exposure to Government of Canada bonds, provincial bonds, and investment-grade corporate bonds. These are the workhorses of the fixed income portfolio. ZAG is fractionally cheaper; both are excellent. Duration of approximately 8–10 years — meaning they're sensitive to interest rate changes.
Duration of 2–3 years. Less price volatility when interest rates move. Better choice for investors closer to needing the money or uncertain about the rate direction in 2026. Lower yield than long-term bonds but more stable.
The cheapest platforms for Canadian ETF investors in 2026:
| Platform | ETF Commissions | Account Minimum | Best For |
|---|---|---|---|
| National Bank Direct Brokerage (NBDB) | $0 (all ETFs) | $0 | Absolute lowest cost; best for regular ETF buyers |
| Questrade | $0 to buy ETFs; $4.95 to sell | $1,000 | Free ETF purchases; broad platform |
| Wealthsimple Trade | $0 (standard); $3/trade (Plus) | $0 | Beginners; app-first investors |
| RBC Direct Investing | $6.95–$9.95/trade | $15,000 or pay quarterly fee | Existing RBC clients; consolidation |
| TD Direct Investing | $6.95–$9.95/trade | $5,000 | TD banking clients; large accounts |
For pure ETF investing in Canada, NBDB (National Bank Direct Brokerage) is the winner on cost — free trades on all ETFs, no account minimum, and a serviceable platform. See our NBDB review for more detail.
MERs and platform fees are current as of March 2026 and subject to change. ETF prices fluctuate — past performance is not a guarantee of future returns. This is not financial advice. Verify all details on provider websites before investing. Last updated March 2026.