If I Could Only Buy and Hold a Single Monthly Dividend ETF, This Would Be it

For income-focused investors, the appeal of monthly dividend ETFs (exchange-traded funds) lies in their consistency, as they tend to provide smoother cash flow, diversified exposure, and a more predictable income stream than many individual stocks.

And if I had to pick just one to buy and hold for the next 10, 20, or 30 years, I’d want an ETF that has quality holdings, low management fees and offers resilience through economic cycles. In this article, I’ll talk about a top monthly dividend ETF that rises above the rest and tell you why I’d feel confident holding it in my income portfolio for the long term.

A top monthly dividend ETF to buy now

That brings us to BMO Canadian Dividend ETF (TSX: ZDV), a fund that feels like a steady hand in a shaky market.

Now, if you’re thinking about dependable monthly income without having to constantly monitor your portfolio, this ETF is worth a serious look. Paying out every month and yielding just over 3.6% annually, it offers a straightforward way to generate steady income. It does that by investing in a diversified group of dividend-paying Canadian companies that have shown resilience over time.

The fund’s net assets sit above $1.1 billion as of May 2025, which is a solid figure that shows investor confidence in its strategy.

Over the last year, it’s up nearly 12%, and over five years, it has delivered a 73% return — strong returns for a fund that’s primarily focused on income.

A sector mix that keeps things balanced

And here’s where things get even better. The BMO Canadian Dividend ETF leans heavily into financials and energy — two top sectors that tend to offer strong dividend support. Together, they make up more than half of its portfolio.

Add to that utilities, industrials, and communication services, and you’ve got exposure across several solid pillars of the Canadian economy. That variety helps reduce risk while still aiming for reliable returns.

What also makes ZDV a top monthly dividend ETF is its structure. It uses a rules-based approach to select stocks not just based on yield but also on three-year dividend growth and payout ratios. That means it isn’t just chasing high-yielders. It’s focusing on companies that have a habit of growing their payouts while keeping them sustainable.

Reasonable costs and strong performance

So, how much does it cost to hold something like this in your portfolio? Well, ZDV ETF’s management expense ratio is just 0.39%. Considering it’s actively rebalanced and professionally managed, that’s a fair tradeoff for the oversight you’re getting. Investors can also breathe easier knowing there are no trailing commissions to chip away at returns.

And if you’re curious how this ETF has done in the long run, the track record is pretty convincing. Over the past 10 years, it’s posted a 7% annualized return.

Overall, ZDV has everything that a top monthly dividend ETF should, as it offers a mix of quality, consistency, and low fuss. If you’re building an income portfolio to last, this one checks a lot of boxes without making it complicated.