The Best-Performing Canadian ETFs of the Month

Exchange-traded funds, or ETFs, are often low-cost instruments for investors to track popular indexes or leverage experienced manager choices in an attempt to beat the market. The best ones serve as building blocks for a portfolio, and unlike open-end mutual funds, all ETFs are traded throughout the day on an exchange.

In August 2024, the top-performing ETFs included real estate equity funds iShares S&P/TSX Capped REIT Index ETF XRE and Global X Equal Weight Canadian REITs Index Corporate Class ETF HCRE. Data in this article is sourced from Morningstar Direct.

Screening for the Best-Performing ETFs

To find the month’s best-performing ETFs, we screened equity, allocation, and fixed income funds that trade within Canada for those that have at least C$10 million in total assets. We narrowed the list to only 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, known as ETNs.

Within our list, five funds fell into the real estate equity category, where the average name rose 3.72% in August.

The 10 Best-Performing ETFs for August 2024:

1. iShares S&P/TSX Capped REIT Index ETF XRE
2. Global X Equal Weight Canadian REITs Index Corporate Class ETF HCRE
3. BMO Equal Weight REITs Index ETF ZRE
4. Vanguard FTSE Canadian Capped REIT Index ETF VRE
5. iShares Equal Weight Banc & Lifeco ETF CEW
6. Invesco S&P 500 Low Volatility Index ETF ULV.F
7. Brompton Global Dividend Growth ETF BDIV
8. BMO Low Volatility US Equity Hedged to CAD ETF ZLH
9. iShares MSCI Min Vol USA Index ETF (CAD-Hedged) XMS
10. Middlefield Real Estate Dividend ETF MREL

Metrics for the Best-Performing ETFs

iShares S&P/TSX Capped REIT Index ETF

• Morningstar Rating: 1 star
• Expense Ratio: 0.61%
• Morningstar Category: Real Estate Equity

The C$1.3 billion iShares S&P/TSX Capped REIT Index ETF was the best-performing ETF in August, with a 6.46% return. The passively managed iShares ETF beat the 3.72% gain on the average fund in Morningstar’s real estate equity category for the month. Over the last 12 months, the iShares S&P/TSX Capped REIT Index ETF has returned 10.18%, underperforming the 15.34% gain on the average fund in its category, leaving the ETF in the 99th percentile.

The iShares S&P/TSX Capped REIT Index ETF has a Morningstar Medalist Rating of Bronze. It was launched in October 2002.

Global X Equal Weight Canadian REITs Index Corporate Class ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.33%
• Morningstar Category: Real Estate Equity

The second-best performing ETF in August was the C$41 million Global X Equal Weight Canadian REITs Index Corporate Class ETF. The passively managed Global X ETF returned 6.23%, outperforming the average real estate equity fund, which gained 3.72%. Looking back over the last 12 months, the Global X Equal Weight Canadian REITs Index Corporate Class ETF has returned 13.29%, underperforming the 15.34% return on the average fund in its category, leaving the ETF in the 82nd percentile.

The Neutral-rated Global X Equal Weight Canadian REITs Index Corporate Class ETF was launched in January 2019.

BMO Equal Weight REITs Index ETF

• Morningstar Rating: 3 stars
• Expense Ratio: 0.61%
• Morningstar Category: Real Estate Equity

The C$592 million BMO Equal Weight REITs Index ETF ranked third for the month, returning 6.22%. The BMO ETF, which is passively managed, topped the 3.72% average return on funds in the real estate equity category for August. Over the last 12 months, the BMO ETF has returned 12.89%, behind the 15.34% gain on the average fund in its category, leaving the ETF in the 89th percentile.

The BMO Equal Weight REITs Index ETF, launched in May 2010, has a Morningstar Medalist Rating of Neutral.

Vanguard FTSE Canadian Capped REIT Index ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.39%
• Morningstar Category: Real Estate Equity

With a 5.45% return, the C$294 million Vanguard FTSE Canadian Capped REIT Index ETF ranked fourth in August. The passively managed Vanguard ETF outperformed the 3.72% return on the average real estate equity fund. Over the last 12 months, the fund has gained 16.52%, ahead of the 15.34% return on funds in its category, placing it in the 34th percentile for the period.

The Vanguard FTSE Canadian Capped REIT Index ETF has a Silver Morningstar Medalist Rating. It was launched in November 2012.

iShares Equal Weight Banc & Lifeco ETF

• Morningstar Rating: 4 stars
• Expense Ratio: 0.61%
• Morningstar Category: Financial Services Equity

The fifth-best performing ETF was the C$210 million iShares Equal Weight Banc & Lifeco ETF, which gained 5.31% in August. This actively managed iShares ETF beat the 2.15% average return on funds in the financial services equity category. Over the past year, the iShares Equal Weight Banc & Lifeco ETF rose 25.71%, underperforming the 27.65% return on the average fund in its category and placing it in the 54th percentile.

The iShares Equal Weight Banc & Lifeco ETF, launched in February 2008, has a Morningstar Medalist Rating of Bronze.

Invesco S&P 500 Low Volatility Index ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.31%
• Morningstar Category: US Equity

The C$127 million Invesco S&P 500 Low Volatility Index ETF was the sixth-best performing Canadian ETF in August, with a 4.96% return. The return on the passively managed Invesco ETF topped the 0.42% gain on the average fund in Morningstar’s US equity category. Looking back over the last 12 months, the Invesco S&P 500 Low Volatility Index ETF has returned 17.14%, underperforming the 23.27% return on the average fund in its category, leaving the ETF in the 86th percentile.

The Neutral-rated Invesco S&P 500 Low Volatility Index ETF was launched in January 2012.

Brompton Global Dividend Growth ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.96%
• Morningstar Category: Canada FUND Global Dividend & Income Equity

The seventh-best performing ETF in August was the C$87 million Brompton Global Dividend Growth ETF. The actively managed Brompton Group ETF returned 4.79%, outperforming the average Canada fund global dividend & income equity fund, which gained 1.04%. Looking back over the last 12 months, the Brompton Global Dividend Growth ETF has returned 30.12%, outperforming the 20.90% return on the average fund in its category, leaving the ETF in the 4th percentile.

The Brompton Global Dividend Growth ETF has a Morningstar Medalist Rating of Neutral. It was launched in October 2018.

BMO Low Volatility US Equity Hedged to CAD ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.33%
• Morningstar Category: US Equity

The C$85 million BMO Low Volatility US Equity Hedged to CAD ETF ranked eighth for the month, returning 4.79%. The BMO ETF, which is actively managed, topped the 0.42% average gain on funds in the US equity category. Over the last 12 months, the BMO ETF has returned 17.43%, behind the 23.27% return on the average fund in its category, leaving it in the 85th percentile for performance.

The Bronze-rated BMO Low Volatility US Equity Hedged to CAD ETF was launched in February 2016.

iShares MSCI Min Vol USA Index ETF (CAD-Hedged)

• Morningstar Rating: 1 star
• Expense Ratio: 0.33%
• Morningstar Category: US Equity

With a 4.79% gain, the C$41 million iShares MSCI Min Vol USA Index ETF (CAD-Hedged) ranked ninth in August. The passively managed iShares ETF outperformed the 0.42% return on the average US equity fund. Over the last 12 months, the fund has returned 21.93%, behind the 23.27% return on funds in its category, placing it in the 63rd percentile.

The iShares MSCI Min Vol USA Index ETF (CAD-Hedged), launched in April 2016, has a Morningstar Medalist Rating of Silver.

Middlefield Real Estate Dividend ETF

• Morningstar Rating: 4 stars
• Expense Ratio: 1.23%
• Morningstar Category: Real Estate Equity

The tenth-best performing ETF was the C$135 million Middlefield Real Estate Dividend ETF, which gained 4.77% in August. The actively managed Middlefield ETF beat the 3.72% average return on funds in the real estate equity category. Over the past year, the Middlefield Real Estate Dividend ETF rose 16.54%, outperforming the 15.34% return on the average fund in its category and placing it in the 30th percentile.

The Middlefield Real Estate Dividend ETF has a Morningstar Medalist Rating of Silver. It was launched in April 2011.

What Are ETFs?

Exchange-traded funds are investments that trade throughout the day on stock exchanges, much like individual stocks. They differ from traditional mutual funds – known as open-end funds – which can only be bought or sold at a single price each day. Historically, ETFs have tracked indexes, but in recent years, more ETFs have been actively managed. ETFs cover a range of asset classes, including stocks, bonds, commodities, and most recently cryptocurrency.

The Best ETFs: More Ideas to Consider

Investors who would like to find more of the top-performing or cheapest ETFs can do the following:

• Use the ETF Screener tool 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.

• Find ideas specific to your needs, or learn more about ETFs, on our ETF Insights page.

• Compare funds and ETFs side by side and easily follow their valuations, ratings, and fees.

This article was compiled by Bella Albrecht, edited by Lauren Solberg, and reviewed by Andrew Willis.

This article was generated with the help of automation and reviewed by Morningstar editors.