Investing in lesser-known Canadian exchange-traded funds (ETFs) on the TSX can be an excellent way to diversify your portfolio with a modest investment. So let’s dive in right now and explore some intriguing ETFs you can buy with just $100.
USD options
First up is the BMO Low Volatility US Equity ETF (TSX: ZLU.U). This ETF focuses on U.S. large-cap stocks with lower sensitivity to market volatility, aiming to provide stable returns. As of writing, its net asset value (NAV) was $56.37 CAD, with a 12-month yield of 1.9%.
Its top holdings include Bristol-Myers Squibb, IBM, and AbbVie, reflecting a concentration in the healthcare and technology sectors. Over the past year, ZLU.U has returned 17.3%, and its year-to-date return stands at 16%, thus indicating robust performance in 2024. The ETF’s low volatility strategy positions it well for investors seeking reduced exposure to market fluctuations.
iShares Core MSCI US Quality Dividend Index ETF (TSX: XDU.U) targets U.S. companies with strong financials and above-average dividend yields. Its diversified portfolio spans sectors like consumer staples and information technology, with top holdings such as Procter & Gamble and Broadcom.
The ETF offers a dividend yield of approximately 2.4%, providing regular income for investors. While specific recent performance data is not available, the focus on quality dividends suggests a stable income stream and potential for capital appreciation, especially appealing in uncertain economic climates.
iShares Core S&P 500 Index ETF (TSX: XUS) offers broad exposure to the American market, encompassing 500 large- and medium-sized companies. Over the last decade, XUS has achieved an impressive annualized return of 15%. With an expense ratio of 0.10%, XUS remains an affordable option for investors seeking U.S. market exposure. The ETF’s alignment with the S&P 500 provides investors with access to the performance of leading U.S. companies, thus making it a staple in many portfolios.
Tech
TD Global Technology Leaders Index ETF (TSX: TEC) provides exposure to global technology giants, including Apple, Microsoft, and Amazon. With a management expense ratio (MER) of 0.39%, it offers a cost-effective way to tap into the tech industry’s growth.
Year-to-date, TEC has returned 26%, reflecting the robust performance of the tech sector. Given the continuous innovation and demand in technology, TEC’s future outlook appears promising, thus aligning with the sector’s growth trajectory.
The TSX
iShares Core S&P/TSX Capped Composite Index ETF (TSX: XIC) provides exposure to a broad selection of Canadian stocks, focusing predominantly on larger companies. Over the past decade, XIC has delivered an annualized return of 7.3% and offers a dividend yield of 2.9%, paid quarterly.
Its low expense ratio of 0.06% makes it an affordable option for investors. XIC’s comprehensive coverage of the Canadian market makes it a foundational holding for those seeking exposure to Canada’s economy.
Then, BMO S&P/TSX 60 Index ETF (TSX: ZIU) tracks the performance of 60 large Canadian stocks. This ETF offers a solid dividend yield of 2.8% and has a management expense ratio of 0.15%. Investing in ZIU provides exposure to prominent blue-chip Canadian stocks, thus making it a valuable addition to a diversified portfolio. The focus on large-cap companies offers stability and potential for steady growth, appealing to conservative investors.
Bottom line
These ETFs provide a range of investment opportunities across different sectors and markets. By investing in a combination of these funds, you can build a diversified portfolio that aligns with your investment goals and risk tolerance.
