XEQT vs VEQT (2026): The Best Canadian All-In-One ETF?

XEQT and VEQT are the two most-discussed Canadian ETFs on the r/CanadianInvestor subreddit. They’re both 100% equity, globally diversified, all-in-one ETFs designed to be a complete equity portfolio in one ticker. The reality is they are 90% the same product. Here’s the honest breakdown of where they differ and which one to pick.

At-a-glance comparison

XEQT vs VEQT — full comparison (May 2026)

	XEQT (iShares)	VEQT (Vanguard)
MER	0.20%	0.24%
Total holdings	~9,000	~13,500
Equity allocation	100%	100%
Auto-rebalance	Yes (internal)	Yes (internal)
Distributions	Quarterly	Quarterly
Listed exchange	TSX	TSX
Currency	CAD	CAD
Inception	2019	2019
AUM (May 2026)	~$5.0B	~$3.5B
Canada weight	~25%	~30%
US weight	~45%	~42%
International weight	~25%	~22%
Emerging weight	~5%	~6%
Dividend yield	~1.6%	~1.7%

Where XEQT wins

1. Lower MER

XEQT charges 0.20% per year. VEQT charges 0.24%. The 0.04% difference is not nothing over decades:

• $10,000 invested for 30 years at 7%: XEQT ends at $76,123, VEQT at $75,232. Difference: $891.
• $100,000 over 30 years: $7,612 vs $7,523 (in thousands). Difference: ~$8,900.
• $500,000 over 30 years: difference grows to ~$45,000.

For larger balances, this is real money. For smaller portfolios, it’s coffee money — but the 20-year compounding effect still matters.

2. Slightly higher US weight

XEQT’s ~45% US allocation has been a tailwind in recent years. VEQT’s lower 42% US weight (with the difference shifted to Canada) has historically dragged 0.1–0.3% per year vs XEQT.

This could reverse — Canadian equities have multi-year stretches where they outperform — but US large-cap has been the long-run winner across multiple decades.

3. Higher AUM and liquidity

XEQT has roughly $5 billion in AUM as of May 2026. VEQT has ~$3.5 billion. Both are highly liquid; this doesn’t matter at retail trade sizes. For institutional or very large retail buys (>$100,000 in a single trade), XEQT’s tighter bid-ask spread can save a few basis points.

Where VEQT wins

1. Higher diversification

VEQT holds ~13,500 stocks vs XEQT’s ~9,000. The extra holdings are mostly small-cap and mid-cap names spread across all four geographic buckets. In purely statistical terms, VEQT is “more diversified.”

In practical terms, this difference is modest. The largest holdings dominate the index regardless — Apple, Microsoft, Royal Bank, BCE — and their weights are similar. The bottom 4,500 stocks in VEQT collectively represent maybe 5–10% of the fund.

2. Slightly heavier Canadian tilt

VEQT allocates ~30% to Canadian equities; XEQT ~25%. This 5% extra Canada weight is meaningful for two reasons:

• Currency exposure: more CAD-denominated holdings means less FX volatility for Canadian investors. VEQT is slightly less affected by USD/CAD swings.
• Dividend tax efficiency: Canadian eligible dividends qualify for the dividend tax credit. VEQT pays slightly more dividend in eligible Canadian form than XEQT, which is more tax-efficient in non-registered accounts.

For TFSA investors, the second point doesn’t matter (everything is tax-free anyway). For non-registered accounts, it’s a small VEQT advantage.

3. Vanguard’s lower-fee culture

Vanguard has a long-term track record of cutting MERs as AUM grows. VEQT was originally 0.25%; it’s already been cut to 0.24%. Future cuts are plausible. iShares cuts MERs less aggressively, so VEQT’s MER could converge with or undercut XEQT’s over time.

This is speculative but historically true at Vanguard.

Where they’re identical

For all practical purposes:

• Risk profile — both are 100% equity, both globally diversified.
• Auto-rebalancing — both maintain target weights internally; you never need to rebalance.
• Account types supported — both can be held in any registered or non-registered account.
• Tax treatment — both pay quarterly distributions; both get the same Canadian eligible dividend treatment.
• Behaviour in market crashes — both fell roughly the same in 2020 (-30% intra-month) and 2022 (-15% peak-to-trough).
• Recovery — both recovered to all-time highs by similar dates.

If you swapped XEQT for VEQT in your portfolio at any point in the last 5 years, your end-state wealth would be within roughly 1% of where it ended up. The choice is genuinely not consequential at the individual investor level.

Real performance comparison (5-year)

XEQT vs VEQT total return, 5-year (annualized, May 2026)

	XEQT	VEQT
5-year total return (annualized)	~9.4%	~9.2%
Best year	+22.1% (2024)	+21.8% (2024)
Worst year	−15.3% (2022)	−14.9% (2022)
Volatility (5y std dev)	~13%	~13%
Max drawdown	−27% (2020)	−27% (2020)

The 5-year annualized return gap of ~0.2% is mostly the MER difference. Strip out the 0.04% MER gap and the rest is geographic-weight noise.

Decision framework

Pick XEQT if:

• You optimize for cost (0.20% MER is the lowest in this category)
• You want slightly more US exposure (~45%)
• You want the largest-AUM, tightest-spread option
• You hold at most other large-cap Canadian ETFs

Pick VEQT if:

• You prefer Vanguard’s brand and product ecosystem
• You want maximum diversification breadth
• You want a slightly heavier Canadian tilt
• You don’t mind paying 0.04% extra MER

Don’t:

• Hold both. Pick one.
• Combine with VFV or XIC — XEQT/VEQT already include the S&P 500 and the TSX.
• Worry about which is “better” — the difference is marginal.

My personal pick

I hold XEQT in my TFSA and have since 2020. The 0.04% MER advantage was the deciding factor at the time, and I’ve never seen a reason to switch. If I were starting fresh today, I’d still pick XEQT — but VEQT would be a perfectly fine alternative.

If your broker offers one but not the other commission-free, take the one that’s free. The cost of the trade overwhelms the MER difference for years.

Where to buy

Both are commission-free to buy at:

• Wealthsimple Trade — $0 buy and sell. Best for beginners.
• Questrade — $0 buy, $4.95–$9.95 sell.
• National Bank Direct Brokerage — $0 both sides.
• Bank brokers (TD, RBC, BMO, CIBC) typically $9.95 per trade.

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Read next

• VFV vs XEQT — pure S&P 500 vs global all-in-one
• Best Canadian ETFs — the broader picture
• Wealthsimple vs Questrade — where to hold them
• TFSA vs RRSP — which account to use