No category sparked more discussion among our selection panel this year than one-decision or all-in-one ETFs designed to deliver a diversified portfolio through a single product. The industry often calls these asset-allocation ETFs, and they appeal to investors seeking a simple, consolidated solution.
Several panel members cautioned against declaring a single fund—such as XEQT—as universally “the best,” since an all-equity fund is not appropriate for every investor. The most important considerations when selecting an asset-allocation ETF are an investor’s risk tolerance and time horizon. A balanced ETF may be far too conservative for someone who needs growth, yet too aggressive for someone with a shorter time frame. Many investors assume there is a single best choice, when in truth they must pick the fund that aligns with their individual situation.
To reflect the range of investor needs, we highlight four funds that represent different risk and return profiles. Readers should decide which profile fits them best before choosing between comparable offerings from different fund families. All the major providers—iShares, BMO, Vanguard, TD and Global X—offer suites of asset-allocation ETFs that typically include conservative (often around 40% stocks/60% fixed income), balanced (60/40), growth (80/20) and all-equity allocations.
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Our picks for the best asset-allocation ETFs
| ETF | Ticker | Management fee | MER | Holdings | Description |
|---|---|---|---|---|---|
| iShares Core Equity ETF Portfolio | XEQT | 0.17% | 0.20% | 5 ETFs / 8,425 u/l | Global diversified equity fund — roughly 45% U.S., 25% Canada, 25% EAFE |
| iShares Core Growth ETF Portfolio | XGRO | 0.17% | 0.20% | 8 ETFs / 21,875 u/l | Growth-oriented 80% equity / 20% bonds portfolio |
| iShares Core Balanced ETF Portfolio | XBAL | 0.17% | 0.19% | 8 ETFs | Classic 60/40 stock/bond mix in a single, low-cost package |
| Vanguard Balanced ETF Portfolio | VBAL | 0.22% | 0.24% | 9 ETFs / >30,000 u/l | One of Canada’s original asset-allocation ETFs; 2.54% yield |
As in previous years, our panel showed a preference for all-equity funds that suit more aggressive investors or those with long investment horizons. The top vote-getter among these was the iShares Core Equity ETF Portfolio (XEQT), with comparable all-equity portfolios from Vanguard (VEQT) and BMO (ZEQT) also receiving strong support.
Within growth-oriented solutions, the iShares Core Growth ETF Portfolio (XGRO) led our voting. For balanced allocations, the iShares Core Balanced Portfolio (XBAL) and the Vanguard Balanced ETF Portfolio (VBAL) tied for top honors. Our panel did not nominate a conservative fund in this round, though each major provider maintains conservative options with expense ratios similar to their growth and equity offerings.
Some judges were skeptical of one-decision ETFs altogether. These funds are often marketed as “set-it-and-forget-it” products, but that simplicity can obscure directional risks. Many asset-allocation ETFs carry significant U.S. equity weightings—frequently more than 40%—and can be heavily influenced by the technology sector. Some recent returns in these allocations have been driven by a relatively narrow set of big-cap, tech-related winners, which increases concentration risk for an investor expecting broad diversification.
Fee competition has been notable across this category. Over the past year both BMO and Vanguard reduced management fees on their asset-allocation ETFs, pushing costs below what was an industry standard of 0.20%. Lower fees can meaningfully improve net returns over long horizons, so expense ratios are an important consideration alongside asset mix and tracking methodology.
Finally, a one-decision ETF does not have to cover every account or purpose. Many investors use an all-in-one ETF for smaller accounts—such as a TFSA or a taxable account—while managing larger retirement accounts with a core suite of individual ETFs or a customized mix. The right approach depends on your goals, tolerance for volatility, and the size of each account. The key takeaway: identify the risk/return profile that fits your situation, then choose the fund and provider that best match that profile.
Watch: Asset-Allocation ETFs — an overview and practical tips for selecting the right allocation for your needs.
- Overview: Best ETFs for Canadian investors
- Best Canadian ETFs
- Best U.S. ETFs
- Best international ETFs
- Best fixed-income ETFs
- Best cash-alternative ETFs
- Desert-island ETF picks
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