How I’d Invest $10,000 With the Loonie in Play

The loonie’s swing can quietly change your results, so this $10,000 plan spreads out currency risk with global stocks and gold.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published February 11, 9:45 pm EST

| More on: XEF

Key Points

A stronger Canadian dollar can shrink foreign gains, so diversify without trying to predict currencies.
XEF gives you instant exposure to thousands of developed-market stocks outside North America at low cost.
CGL.C adds gold as a small insurance position that can help when markets wobble and the loonie moves.

The loonie has been lively, and that matters when you drop $10,000 into the market. The Bank of Canada’s daily data showed CAD/USD at about 0.7383 on Feb. 10, 2026, which equals roughly US$0.738 per CAD$1. The currency sat near an 11-day high around that level. When CAD moves, it changes your Canadian-dollar return on anything priced abroad. A stronger loonie can mute foreign gains. A weaker loonie can amplify them. So, what should investors do?

With that backdrop, I would invest $10,000 in a way that does not require a currency forecast. I would put $7,000 into international stocks through iShares Core MSCI EAFE IMI Index ETF (TSX:XEF). Then I would put $3,000 into iShares Gold Bullion ETF (TSX:CGL.C). The mix gives you long-term growth potential plus an “insurance” sleeve that can help when markets and currencies both get jumpy. I would also commit to holding for years, not months, and adding new money on a schedule.

A close up color image of a small green plant sprouting out of a pile of Canadian dollar coins "loonies." — Source: Getty Images

XEF

XEF is a one-ticket way to own developed markets outside North America. It aims to track the MSCI EAFE Investable Market Index, and it held about 2,474 stocks in its latest fact sheet. That spreads risk across countries and thousands of companies, instead of leaning on a handful of Canadian names. The fund also listed net assets of about $17.9 billion, which tells you it has real scale and tight tracking.

The last year for XEF has really been about results and the currency layer. It currently shows a year-to-date return of 7.4%, with the ETF’s net asset value (NAV) sitting at $49.59 at writing. Those are solid numbers, but the loonie still gets a vote. If CAD strengthens, your Canadian-dollar return can look smaller than the underlying market’s return. If CAD weakens, it can feel like a bonus.

Your outcome with this ETF comes from dividends and earnings growth inside thousands of firms, minus fees. On costs, XEF’s fact sheet listed a 0.20% management fee and a 0.23% MER, plus a distribution yield of 2.3% at the time of writing. That combination is the appeal: steady exposure, low fuss, and a fee that does not eat the whole meal.

CGL

CGL.C does one job, and it keeps it simple. It seeks to replicate the price of physical gold bullion, less fees and expenses, and it is unhedged to the Canadian dollar. That unhedged design matters when the loonie is moving. If CAD weakens, the Canadian-dollar price of gold can rise even if the U.S.-dollar gold price stays flat. As of writing, its NAV was $56.91, trading up 15.4% so far this year.

The numbers also show why gold can earn a small seat at the table. CGL.C also boasts an incredible 65% increase in the last year. It also listed net assets of about $860 million, a 0.50% management fee and a 0.55% MER. Gold can cool off fast, but it can also shine when inflation fears, geopolitical stress, or equity volatility flare.

Bottom line

Could this be a buy for others with $10,000 and the loonie in play? It can, but only if the role fits. XEF works best for investors who need more global diversification than the TSX can offer, and who can hold through currency swings without panic-selling. CGL.C suits investors who want a small hedge and can accept that it produces little income and can lag in calm markets.

If you already own global stocks elsewhere, you may not need XEF. If you hate volatility, you may want a more balanced ETF instead. The key is staying consistent when the loonie tempts you to tinker.