What are we looking for?
Canadian‑domiciled ETFs that have passed the five-year sniff test.
The screen
In a recent column, we dug into the Canadian ETF “graveyard” – a reminder that not every new fund is built to last. The headline numbers were striking: 654 were wound up over the past two decades, often within just a few years of launch. That raises a natural follow-up question: What about the ones that didn’t end up in the graveyard?
To answer that, it helps to rewind the clock. Cast your mind back to 2020 and 2021. Markets were anything but normal. The early days of the pandemic brought sharp investor drawdowns, followed by one of the strongest rebounds in recent memory. Policy support was unprecedented, interest rates hovered near zero and retail participation surged. For ETFs, it created something of a perfect storm – heightened investor attention, strong inflows and a steady cadence of new product launches designed to meet demand. As always, not all of those ideas were destined to succeed, but a handful have now had time to prove themselves.
Newer ETFs beginning to establish a track record a worth a look
Today, ETFs launched during that time window are no longer “new.” They’ve experienced different market regimes – from pandemic recovery, to inflation shocks, to rising rates. They’ve had to attract and retain investor capital. And importantly, they now carry enough history for us to evaluate them on more than just a compelling pitch at launch. That combination makes them an interesting cohort to study.
As such, this week we’re looking at which ETFs have quietly made it past an important early hurdle – not just surviving, but beginning to establish a track record worth paying attention to. To do so, I used Morningstar Direct to screen the universe of over 2,000 Canadian‑domiciled ETFs for those that were launched in calendar years 2020 and 2021 (of which 144 exist today). I further screened this universe for those that have a received a Five‑Star Morningstar Rating for Funds (a lookback at after-fee risk-adjusted returns against peers) and a Gold Morningstar Medallist Rating, reflecting Morningstar’s conviction that the ETF has the ingredients to outperform peers in the future.
Five Canadian companies offering exposure to rising iron, gold and silver prices
What we found
The qualifying funds based on the above criteria are listed in the table accompanying this article alongside tickers, management expense ratios, trailing returns and asset allocations – noting that all ETFs on the list have received five stars and are gold-rated (not displayed on table). Readers are urged to note the category to which each fund belongs, as Morningstar’s ratings are relative to these industry-standard categories. This article does not constitute financial advice, investors are encouraged to conduct their own independent research before buying or selling any ETF listed here.
Ian Tam, CFA, is director of investment research for Morningstar Canada.