I want to introduce some of the yield chasers among my readers to the concept of total returns.
The short version? Stop focusing on how much income you get from investments. The only thing that truly matters is total return—which comes from both dividends and share price appreciation. Why?
Because if you maximize total returns, you can sell shares whenever you need income. It’s just math. Dividends aren’t free money— all else being equal, they reduce a company’s share price by the amount paid out.
So, if I were investing a $7,000 2025 Tax-Free Savings Account (TFSA) contribution for total return, here’s what I would do.
Focus on maximum diversification
I want growth, but I want sustainable growth—so that means no going all in on a single stock or sector like tech.
Instead, I want a mix of different asset classes from various geographies and sectors. For stocks, that means small-cap, mid-cap, and large-cap companies from countries all over the world, spread across all 11 stock market sectors.
I also want some bonds in the mix. They help reduce risk without dragging down returns too much. A combination of government and corporate bonds provides balance, ensuring stability during market downturns.
Finally, I want some alternative asset classes—notably crypto. I know opinions are divided, but in my view, a small 2-5% allocation doesn’t hurt. It’s a hedge against missing out on future upside and prevents FOMO if crypto markets rally.
The only ETF that fits the bill
The only ETF that ticks all these boxes for me is Fidelity All-in-One Growth ETF (NEOE:FGRO).
This ETF starts with 82% in stocks from the U.S., Canada, and international markets. These stocks are divided into four investing styles—momentum, low volatility, value, and quality—to provide greater diversification.
Then, 15% is allocated to Canadian and global bonds, which helps reduce risk while slightly increasing income.
To top it off, 3% is allocated to cryptocurrency, specifically Bitcoin, adding a small but meaningful boost to long-term returns without overwhelming the portfolio.
All this comes at a 0.42% expense ratio, and historically, FGRO has delivered a 13.14% annualized return over the past three years—beating competitors from Vanguard and iShares.
