Canadian (TSX) Dividend ETFs

by Avrex on September 21, 2012

Which Canadian Dividend ETF should I add to my portfolio?
Here are the three biggest Dividend ETFs in Canada.

Canadian Dividend ETF Name Symbol MER Yield
BMO Canadian Dividend ETF ZDV 0.35 % 5.20 %
iShares Dow Jones Canada Select Dividend Index Fund XDV 0.55 % 3.85 %
iShares S&P/TSX Canadian Dividend Aristocrats Index Fund CDZ 0.67 % 3.29 %



The BMO Canadian Dividend ETF (ZDV) looks pretty good, with a low cost MER of just 0.35%.

Let’s investigate further, by breaking down the holdings of these ETFs, by sector weighting.

Sector ZDV (MER 0.35%) XDV (MER 0.55%) CDZ (MER 0.67%)
Financials 33.1% 51.3% 24.1%
Energy 20.5% 15.2% 18.0%
Consumer Discretionary 16.5% 4.8% 20.9%
Utilities 15.7% 6.5% 10.6%
Industrials 2.9% 6.5% 10.5%
Telecommunication Services 6.6% 15.3% 5.5%
Other Sectors 4.3% 0.0% 10.5%


Looking at this table, the iShares Dow Jones Canada Select Dividend Index Fund (XDV) looks a bit too heavy in both Financials and Telecommunications (versus a world sector breakdown of 24 % and 5 %, respectively).

The BMO Canadian Dividend ETF (ZDV) appears to be more in line with the true weighting of the overall Canadian market.

Although, the weighting looks ok, the MER price of 0.67%, rules out the iShares S&P/TSX Canadian Dividend Aristocrats Index Fund (CDZ)

Conclusion

In my opinion, the best Canadian Dividend ETF is the BMO Canadian Dividend ETF (ZDV)

Individual Stock Holdings – Comparison

In this final table, I have further broken down the sector weightings down to their individual company holdings. It’s interesting to see which companies have been included/excluded in each ETF.

Get Free Email Updates:
I take your privacy very seriously

{ 3 comments… read them below or add one }

My Own Advisor October 6, 2012 at 11:11 PM

Great post, really enjoyed the comparison. When you look at the MER and see how well ZDV compares to the index, like XIC, it’s the best deal.

Mark

Reply

Avrex October 7, 2012 at 11:46 AM

Thanks. The assets under management for BMOs ZDV is small in comparison to the two iShares products. I’m surprised more Canadians haven’t discovered ZDV yet.

Reply

None March 27, 2013 at 5:19 PM

I appreciate you doing all the hard work for me. I’m in for ZDV.

Reply

Leave a Comment

*

Previous post:

Next post: