When you are in the middle of your career, investing tends to be about balance. You still have time on your side, so growth matters, but you also want something you can hold through market cycles without constantly second-guessing yourself. The biggest enemy at this stage is over-complication.
A diversified exchange–traded fund (ETF) that blends strong growth potential with some built-in risk control can solve that problem. If I had $2,000 to invest today and wanted a single ETF I could realistically hold for decades, the BMO Growth ETF (TSX: ZGRO) would be a very strong candidate.
ZGRO: 80% in stocks
ZGRO is an asset allocation ETF designed for investors who want growth first, but not at all costs. Like other all-in-one ETFs, it is a fund of funds. Instead of picking individual stocks, it holds a collection of underlying BMO ETFs that together form a globally diversified portfolio.
The growth engine is the 80% allocation to equities. That equity exposure spans Canadian stocks through the S&P/TSX Capped Composite, U.S. large caps via the S&P 500, developed international markets through the MSCI EAFE Index, and emerging markets. There is also exposure to U.S. mid- and small-cap stocks, which adds another layer of long-term growth potential.
Stocks tend to compound over time because companies grow earnings, reinvest capital, expand into new markets, and return cash through dividends and buybacks. There will be periods of underperformance. That is unavoidable. The advantage of ZGRO is that you are not betting on any single country, sector, or company. You own thousands of businesses around the world in one trade.
ZGRO: 20% in bonds
The remaining 20% of the portfolio is allocated to bonds. This is not meant to eliminate volatility. It is there to reduce the odds of extreme outcomes and to help keep investors invested when equity markets are under pressure.
ZGRO focuses on investment-grade bonds, including Canadian bonds and U.S. aggregate bonds. These typically include government bonds, high-quality corporate debt, and securitized assets. They generate steady income and tend to behave differently than stocks during periods of economic stress.
Bonds will not drive long-term growth. They are unlikely to outperform equities over long horizons. Their role is structural. They provide stability, some income generation, and a smoother ride during drawdowns, which matters more than most people realize when markets get uncomfortable.
