Over the years, I have come to really like the all-in-one ETFs from Vanguard and iShares. I like these ETFs because they are a simple way to diversify your portfolio across different sectors and countries. These ETFs also automatically rebalance regularly, making an investor’s life much easier.
Due to the popularity of the all-in-one ETFs, both TD and BMO also created similar ETFs. Which company offers the best all-in-one ETFs? Are TD ETFs better? Are iShares ETFs better? Are Vanguard ETFs better? Or are BMO ETFs better?
Let’s find out!
TD ETFs
TD has many different ETFs, including active ETFs, special focused ETFs, and broad market index ETFs that are well-suited for different investment strategies. When it comes to all-in-one ETFs, TD offers three different ETFs that were created in 2020:
- TD Conservative ETF Portfolio (TCON) – 70% fixed income, 30% equities
- TD Balanced ETF Portfolio (TBAL) – 40% fixed income, 60% equities
- TD Growth ETF Portfolio (TGRO) – 10% mixed income, 90% equities
All three of these TD all-in-one ETFs have a MER of 0.17%. This means if you have $1k invested in one of these ETFs, you effectively would pay $1.7 in fees every year, which is extremely cheap if you think about it.
Here are the historical performances of these three ETFs:
| 1 Yr | 2 Yr | 3 Yr | |
| TCON | 12.48% | 9.63% | 4.41% |
| TBAL | 19.27% | 14.96% | 8.04% |
| TGRO | 26.27% | 20.16% | 11.70% |
You can buy and sell all three ETFs via online brokers. Since many brokers offer commission-free trades nowadays, you can buy one of these all-in-ones regularly and build up your portfolio.
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BMO ETFs
Like TD, BMO offers five different all-in-one ETFs (BMO calls them Asset Allocated ETFs).
- BMO Conservative ETF (ZCON) – 60% fixed income, 40% equities
- BMO Balanced ETF (ZBAL) – 40% fixed income, 60% equities
- BMO Balanced ESG ETF (ZESG) – 40% fixed income, 60% equities
- BMO Gorwth ETF (ZGRO) – 20% fixed income, 80% equities
- BMO All-Equity ETF (ZEQT) – 100% equities
All five BMO all-in-ones have an MER of 0.20%.
ZBAL and ZESG are very similar, except ZESG is for investors looking to align their investments with their social values.
Here are the historical performances of the five BMO ETFs:
| 1 Yr | 2 Yr | 3 Yr | |
| ZCON | 13.94% | 9.74% | 4.79% |
| ZBAL | 18.67% | 13.10% | 7.25% |
| ZESG | 18.63% | 14.61% | 7.68% |
| ZGRO | 23.52% | 16.49% | 9.71% |
| ZEQT | 28.35% | 19.83% | 12.09% |
ZCON, ZBAL, and ZESG have more than 40% exposure to Canada, while ZGRO and ZEQT are more heavily exposed to the US.
Like BMO, iShares offers five all-in-one ETFs.
- iShares Core Income Balanced ETF Portfolio (XINC) – 80% fixed income, 20% equities
- iShares Core Conservative Balanced ETF Portfolio (XCNS) – 60% fixed income, 40% equities
- iShares Core Balanced ETF Portfolio (XBAL) – 40% fixed income, 60% equities
- iShares Core Growth ETF Portfolio (XGRO) – 20% fixed income, 80% equities
- iShares Core Equitity ETF Portfolio (XEQT) – 100% equities
All five ETFs have an MER of 0.20%.
Here are the historical performances of the five iShares ETFs:
| 1 Yr | 3 Yr | |
| XINC | 9.97% | 2.81% |
| XCNS | 14.38% | 5.07% |
| XBAL | 18.81% | 7.70% |
| XGRO | 23.47% | 9.65% |
| XEQT | 28.06% | 11.92% |
Vanguard ETFs
Finally, Vanguard all-in-one ETFs:
- Vanguard Conservative Income ETF Portfolio (VCIP) – 80% fixed income, 20% equities
- Vanguard Retirement Income ETF Portfolio (VRIF) – 70% fixed income, 30% equities
- Vanguard Conservative ETF Portfolio (VCNS) – 60% fixed income, 40% equities
- Vanguard Balanced ETF Porfolio (VBAL) – 40% fixed income, 60% equities
- Vanguard Growth ETF Portfolio (VGRO) – 20% fixed income, 80% equities
- Vanguard All-Equity ETF Portfolio (VEQT) – 100% equities
VRIF has an MER of 0.29%, while the other five all-in-ones have an MER of 0.22%. VRIF probably has a slightly higher MER because of the fund structure. Interestingly enough, Vanguard all-in-ones have the highest MER out of the four fund companies (I said this because historically Vanguard has lead the way when it comes to lowest MER).
Here are the historical performances of the Vanguard all-in-one ETFs:
| 1 Yr | 3 Yr | |
| VCIP | 8.90% | 1.99% |
| VRIF | 10.44% | 3.08% |
| VCNS | 13.61% | 4.45% |
| VBAL | 18.40% | 6.90% |
| VGRO | 23.39% | 9.39% |
| VEQT | 28.40% | 11.83% |
The best all-in-one ETFs for your investment portfolio
As you can see, all four fund companies offer all-in-one ETFs with different asset exposures. Which are the best all-in-one ETFs for your investment portfolio?
Well, that is totally dependent on your risk tolerance and your investment timeline.
If you are an investor who is approaching retirement or is already retired, you might want to invest in something more conservative. In other words, you don’t want to lose sleep whenever there’s a market correction. For you, a steady investment income and stable portfolio value growth is more important. Therefore, you probably will go with either a conservative all-in-one ETF or a balanced all-in-one ETF.
If you are younger with a longer investment time horizon, you want to aim for portfolio growth. Therefore, you’d probably go with either a growth all-in-one ETF or an all-equity ETF to maximize your return over the long term.
Best Conservative All-in-One ETF
As mentioned, if you are a conservative investor who needs a steady investment income with stable portfolio value growth, a conservative all-in-one ETF is probably the best choice for you.
The question is, which conservative all-in-one ETF is the best?
Let’s compare TCON, ZCON, XINC, XCON, VCIP, VRIF, and VCONs all of which are heavily exposed to fixed income.
| Fixed income to equities Mix | MER | 1 yr return | 3 yr return | 5 yr return | Yield % | |
| TCON | 70-30 | 0.17% | 12.48% | 4.41% | N/A | 2.26% |
| ZCON | 60-40 | 0.20% | 13.94% | 4.79% | 4.87% | 2.45% |
| XINC | 80-20 | 0.20% | 9.97% | 2.81% | 2.86% | 2.70% |
| XCON | 60-40 | 0.20% | 14.38% | 5.07% | 5.35% | 2.17% |
| VCIP | 80-20 | 0.25% | 8.90% | 1.99% | 2.11% | 2.86% |
| VRIF | 70-30 | 0.32% | 10.44% | 3.08% | N/A | 3.55% |
| VCON | 60-40 | 0.24% | 13.61% | 4.45% | 4.71% | 2.51% |
Among ZCON, XCON, and VCON, which all have the same 60-40 mix, it’s interesting to see that XCON had the best returns consistently, but XCON has the lowest distribution yield.
Among TCON, XINC, VCIP, and VRIF, TCON has had the highest returns, most likely due to the lower MER fees.
Not surprisingly, ETFs with a higher exposure to stocks have had higher returns in the last five years.
If I were a conservative investor, I’d probably prefer XCON over the other six conservative all-in-one ETFs due to the following reasons:
- At 0.20% MER, it’s one of the lowest
- BlackRock is behind the iShares funds, so no concerns with the integrity and financial stability of the company
- 2.17% is a reasonable yield considering 60% of the ETF is made up of fixed income
Given the current low interest rate environment, I would not go with more than a 60-40 fixed income to equities mix. I believe if you hold too much fixed income, regardless of your risk tolerance and age, you will hurt your overall return in the long run.
Best Balanced All-in-One ETF
What if you’re looking for a more balanced approach? What is the best balanced all-in-one ETF?
Let’s compare TBAL, ZBAL, ZESG, XBAL, and VBAL.
| Fixed income to equities Mix | MER | 1 yr return | 3 yr return | 5 yr return | Yield % | |
| TBAL | 40-60 | 0.17% | 19.27% | 8.04% | N/A | 1.28% |
| ZBAL | 40-60 | 0.20% | 18.67% | 7.25% | 7.42% | 2.14% |
| XBAL | 40-60 | 0.20% | 18.81% | 7.36% | 7.70% | 4.28% |
| VBAL | 40-60 | 0.24% | 18.40% | 6.90% | 7.29% | 2.23% |
Since all four of these balanced all-in-one ETFs have similar asset exposure mixes, it is not a surprise that the performances are all quite similar. I am surprised, however, that XBAL has a much higher yield than the other three ETFs.
TBAL has had slightly higher returns in the last three years, possibly caused by the lower MER. Interestingly, VBAL has the lowest returns and it happens to have the highest MER.
It is hard not to ignore TBAL, given the lowest MER and highest returns. But TBAL is relatively new (started in 2020) and has a lower trading volume than the other three. So it is something to consider if you decide to invest in TBAL.
Which is the best balanced all-in-one ETF? For me, I’d probably pick between TBAL or XBAL.My rationales are: TBAL has the higher returns and lowest MER, while XBAL because it is managed by iShares.
Having said that, it’s very hard to separate TBAL, ZBAL, XBAL, and VBAL because they’re so very close. Honestly, I don’t think you can go wrong with any one of them.
Best Growth all-in-one or all-equity ETFs
Let’s compare the growth all-in-one ETFs and all-equity ETFs.
| Fixed income to equities Mix | MER | 1 yr return | 3 yr return | 5 yr return | Yield % | |
| TGRO | 10-90 | 0.17% | 26.27% | 20.16% | N/A | 0.32% |
| ZGRO | 20-80 | 0.20% | 23.52% | 9.71% | 9.97% | 1.88% |
| XGRO | 20-80 | 0.20% | 23.47% | 9.65% | 10.08% | 2.37% |
| VGRO | 20-80 | 0.24% | 23.39% | 9.39% | 9.86% | 1.96% |
| ZEQT | 0-100 | 0.20% | 28.35% | 12.09% | N/A | 1.66% |
| XEQT | 0-100 | 0.20% | 28.06% | 11.92% | 12.38% | 1.98% |
| VEQT | 0-100 | 0.24% | 28.40% | 11.83% | 12.38% | 1.52% |
Given the market performance the last few years and the low interest rates environment, the all-equity ETFs have higher returns than ETFs that have fixed income exposure.
We invest in XEQT for both kids’ RESPs over VEQT because of the lower MER (XEQT used to have a higher exposure to the US market but not anymore). So we prefer XEQT over the other all-equity ETFs.
However, among ZEQT, XEQT, and VEQT, they’re all very close, so you can’t go wrong with any of them.
Now, if you are slightly more cautious and want to have some exposure to fixed income, I’d probably go with TGRO over the other growth all-in-one ETFs. Since it’s all about portfolio growth for the growth and all-equity ETFs, I would not put too much emphasis on distribution yield.
Why invest in an all-in-one ETF
Why do I recommend investing in an all-in-one ETF?
Simplicity and instant diversification.
These all-in-one ETFs are excellent for someone who’s just starting out on their investing journey. (In fact, I think these all-in-one ETFs are excellent for everyone!) By taking advantage of the commission-free trades that many Canadian online brokers offer, you can build up a sizable investment portfolio over time with one of these all-in-one ETFs.
Essentially, you can start a recurring contribution and purchase program and buy an all-in-one ETF of your choice without paying any trading fees. Furthermore, because of the extremely low MER, you are not forking out an arm and a leg for your investment. At the end of the day, you will have more money in your pocket!
Summary – Which all-in-one ETF is the best?
It’s excellent that there are so many all-in-one ETFs available for Canadians. It is far easier to be a DIY investor now than 10 years ago. We can all be very grateful that the Canadian investing landscape has changed so much.
It’s a good idea to pick an all-in-one ETF based on your risk tolerance and your investment timeline. Once you pick one and start investing, it is important to stay in the market rather than jumping in and out of the market.
Happy investing everyone!
Nice (and easy) to read article. When I read other comments about $1M portfolio, I wonder if it would be a good choice for a 70 yrs old couple to put “all their eggs in one ETF basket”, like an all-in-one ETF. Let’s say their total portfolio is $2M, and they are “balanced” people, with RRSP, RRIF, TFSA and non-reg accounts, then would they switch everything they have in their accounts to something like VBAL, or similar? Today, VBAL is about $33 per share, so that couple would have to buy more than 60,000 shares of VBAL spread out in all their accounts. And if they need $5,000 per month, they would sell about 150 shares each month to cover their expenses. Is that the way to do it? Could it be that simple?
If you don’t want to rebalance yourself regularly and want to keep it simple, I think VBAL would be a good choice. I wouldn’t consider selling 150 each month but rather sell only a few times a year (or once year when the market is high) to cover the expenses.
Thank you for your weekly newsletter, there is always something to learn. Is it advisable to invest in TGRO under my TFSA account. Thanks!
Hi Diane,
You’re very welcome. TGRO under TFSA is totally fine.
Can you give us Canadian ETFS with the highest income yields where monthly income is required for retirees.
Have you looked at the Global X family of all in ones? I’m in HEQT and it’s return had been doing better than VEQT and XEQT in previous years. I also like that it’s got a little more international exposrue.
I haven’t but I guess I should have compared the Global X family too. 🙂
The all equity ETF still have high MER 0.17-.2.
Whereas SP 500 VFV is 0.09
If have US$ it’s really low like VOO or VIG SPY are 0.03
Isn’t it better just to get VOO if have US$ or VFV if low MER and all equity wanted ?
If you want to invest all your money in the US economy, yes. But is that the best approach to concentrate everything in one country?
The early comment that 0.17% is cheap is interesting. While it’s true $1.70 on a $1000 sounds inexpensive, …. many investors have $1M. Now that same ETF is costing $1700/year. Not huge but I would rather it was in my pocket. A sliding scale based on account value would make sense and would convince me to move my accounts.
One reason Im leaning toward all-in-one ETF’s is the difficulty in choosing what to sell during the decumulation phase. It’s like I have a ‘relationship’ with some holdings I have held for decades. Switching to an all-in-one will mean I can simply sell as many units as needed to generate cash, without worrying about selling an individual stock at the wrong time.
Yes it does simply the selling process. 🙂
Well, if you have $1M portfolio, $1,700 per year cost is still only 0.17% of your portfolio and I’d argue that $1,700 is relatively cheap if you have a $1M portfolio. It’s still way cheaper than any mutual funds you can find. Now, if you were to construct your own portfolio, yes you probably wouldn’t be spending $1,700 on fees each year.
Hi, thanks for your study.
Re the returns shown: could you please add the close date and if they are price or total. Also could you possibly include comparisons of the all equity all-in-one ETFs.
Hi Bernie,
Sorry what did you mean by close date? Those are total return.
Hi Tawcan,
Thanks, just want to know the end calendar date of the annualized total returns you tabled, ie; Dec 31st or Jan 31st or Feb 28th, etc
Ahh, it was Feb 28. Hope that helps.