Mutual FundsCommentary

Exchange-traded funds, or ETFs, are often low-cost instruments for investors to track popular indexes or leverage experienced manager choices in an attempt to beat the market. The best ones serve as building blocks for a portfolio, and unlike open-end mutual funds, all ETFs are traded throughout the day on an exchange.

In October 2024, the top-performing ETFs included financial services equity funds RBC US Banks Yield Index ETF RUBY and BMO Equal Weight US Banks Index ETF ZBK. Data in this article is sourced from Morningstar Direct.

Screening for the Best-Performing ETFs

To find the month’s best-performing ETFs, we screened equity, allocation, and fixed income funds that trade within Canada for those that have at least C$10 million in total assets. We narrowed the list to only ETFs with parent pillars for their Morningstar Medalist Ratings of average or above, meaning our analysts believe they’re backed by industry-standard asset management companies. We also excluded exchange traded notes, known as ETNs.

The 10 Best-Performing ETFs for October 2024

1. RBC US Banks Yield Index ETF RUBY
2. BMO Equal Weight US Banks Index ETF ZBK
3. BMO Covered Call US Banks ETF ZWK
4. BMO Junior Gold Index ETF ZJG
5. BMO Equal Weight Global Gold Index ETF ZGD
6. Evolve US Banks Enhanced Yield Fund CALL
7. Global X Gold Producer Equity Covered Call ETF GLCC
8. Brompton North American Financials Dividend ETF BFIN
9. Middlefield US Equity Dividend ETF MUSA
10. Global X Pipelines & Energy Services Index ETF PPLN

Metrics for the Best-Performing ETFs

RBC US Banks Yield Index ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.32%
• Morningstar Category: Financial Services Equity

The C$14 million RBC US Banks Yield Index ETF was the best-performing ETF in October, with an 8.95% return. The passively managed RBC ETF beat the 2.80% gain on the average fund in Morningstar’s financial services equity category for the month. Over the last 12 months, the RBC US Banks Yield Index ETF has returned 64.46%, outperforming the 33.89% gain on the average fund in its category, leaving the ETF in the 5th percentile.

The RBC US Banks Yield Index ETF has a Morningstar Medalist Rating of Bronze. It was launched in May 2018.

BMO Equal Weight US Banks Index ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.38%
• Morningstar Category: Financial Services Equity

The second-best performing ETF in October was the C$762 million BMO Equal Weight US Banks Index ETF. The passively managed BMO ETF returned 8.79%, outperforming the average financial services equity fund, which gained 2.80%. Looking back over the last 12 months, the BMO Equal Weight US Banks Index ETF has returned 70.24%, outperforming the 33.89% return on the average fund in its category, leaving the ETF in the 1st percentile.

The Neutral-rated BMO Equal Weight US Banks Index ETF was launched in February 2014.

BMO Covered Call US Banks ETF

• Morningstar Rating: 1 star
• Expense Ratio: 0.71%
• Morningstar Category: Financial Services Equity

The C$342 million BMO Covered Call US Banks ETF ranked third for the month, returning 6.93%. The BMO ETF, which is actively managed, topped the 2.80% average return on funds in the financial services equity category for October. Over the last 12 months, the BMO ETF has returned 59.26%, ahead of the 33.89% gain on the average fund in its category, leaving the ETF in the 12th percentile.

The BMO Covered Call US Banks ETF, launched in February 2019, has a Morningstar Medalist Rating of Neutral.

BMO Junior Gold Index ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.61%
• Morningstar Category: Precious Metals Equity

With a 6.15% return, the C$81 million BMO Junior Gold Index ETF ranked fourth in October. The passively managed BMO ETF outperformed the 3.81% return on the average precious metals equity fund. Over the last 12 months, the fund has gained 56.24%, ahead of the 49.37% return on funds in its category, placing it in the 38th percentile for the period.

The BMO Junior Gold Index ETF has a Negative Morningstar Medalist Rating, meaning that our analysts expect it to be one of the worst performers within its category and think it is unlikely to deliver positive returns after fees.

BMO Equal Weight Global Gold Index ETF

• Morningstar Rating: 3 stars
• Expense Ratio: 0.60%
• Morningstar Category: Precious Metals Equity

The fifth-best performing ETF was the C$121 million BMO Equal Weight Global Gold Index ETF, which gained 5.88% in October. This passively managed BMO ETF beat the 3.81% average return on funds in the precious metals equity category. Over the past year, the BMO Equal Weight Global Gold Index ETF rose 62.26%, outperforming the 49.37% return on the average fund in its category and placing it in the 12th percentile.

The BMO Equal Weight Global Gold Index ETF, launched in November 2012, has a Morningstar Medalist Rating of Neutral.

HSBC NASDAQ Global Semiconductor UCITS ETF

• Morningstar Rating: 1 star
• Expense Ratio: 0.65%
• Morningstar Category: Financial Services Equity

The C$107 million Evolve US Banks Enhanced Yield Fund was the sixth-best performing Canadian ETF in October, with a 5.01% return. The return on the passively managed Evolve Funds ETF topped the 2.80% gain on the average fund in Morningstar’s financial services equity category. Looking back over the last 12 months, the Evolve US Banks Enhanced Yield Fund has returned 57.23%, outperforming the 33.89% return on the average fund in its category, leaving the ETF in the 13th percentile.

The Negative-rated Evolve US Banks Enhanced Yield Fund was launched in October 2017.

Global X Gold Producer Equity Covered Call ETF

• Morningstar Rating: 3 stars
• Expense Ratio: 0.78%
• Morningstar Category: Precious Metals Equity

The seventh-best performing ETF in October was the C$247 million Global X Gold Producer Equity Covered Call ETF. The passively managed Global X ETF returned 4.91%, outperforming the average precious metals equity fund, which gained 3.81%. Looking back over the last 12 months, the Global X Gold Producer Equity Covered Call ETF has returned 43.36%, underperforming the 49.37% return on the average fund in its category, leaving the ETF in the 85th percentile.

The Global X Gold Producer Equity Covered Call ETF has a Morningstar Medalist Rating of Negative. It was launched in April 2011.

Brompton North American Financials Dividend ETF

• Morningstar Rating: 3 stars
• Expense Ratio: 0.96%
• Morningstar Category: Financial Services Equity

The C$58 million Brompton North American Financials Dividend ETF ranked eighth for the month, returning 4.87%. The Brompton Group ETF, which is actively managed, topped the 2.80% average gain on funds in the financial services equity category. Over the last 12 months, the Brompton Group ETF has returned 46.60%, ahead of the 33.89% return on the average fund in its category, leaving it in the 28th percentile for performance.

The Neutral-rated Brompton North American Financials Dividend ETF was launched in October 2018.

Middlefield US Equity Dividend ETF

• Morningstar Rating: 4 stars
• Expense Ratio: 1.49%
• Morningstar Category: US Dividend & Income Equity

With a 4.44% gain, the C$47 million Middlefield US Equity Dividend ETF ranked ninth in October. The actively managed Middlefield ETF outperformed the 1.72% return on the average us dividend & income equity fund. Over the last 12 months, the fund has returned 49.44%, ahead of the 28.16% return on funds in its category, placing it in the 1st percentile.

The Middlefield US Equity Dividend ETF, launched in December 2013, has a Morningstar Medalist Rating of Neutral.

Global X Pipelines & Energy Services Index ETF

• Morningstar Rating: 4 stars
• Expense Ratio: 0.74%
• Morningstar Category: Energy Equity

The tenth-best performing ETF was the C$31 million Global X Pipelines & Energy Services Index ETF, which gained 4.32% in October. The passively managed Global X ETF beat the 2.92% average loss on funds in the energy equity category. Over the past year, the Global X Pipelines & Energy Services Index ETF rose 24.09%, outperforming the 5.46% return on the average fund in its category and placing it in the 1st percentile.

The Global X Pipelines & Energy Services Index ETF has a Morningstar Medalist Rating of Neutral. It was launched in July 2014.

What Are ETFs?

Exchange-traded funds are investments that trade throughout the day on stock exchanges, much like individual stocks. They differ from traditional mutual funds – known as open-end funds – which can only be bought or sold at a single price each day. Historically, ETFs have tracked indexes, but in recent years, more ETFs have been actively managed. ETFs cover a range of asset classes, including stocks, bonds, commodities, and most recently cryptocurrency.

The Best ETFs: More Ideas to Consider

Investors who would like to find more of the top-performing or cheapest ETFs can do the following:

• Use the ETF Screener tool to find the best ETFs according to your specific criteria. You can search for funds based on their fees, Morningstar Medalist Ratings, manager tenures, and more.
• Find ideas specific to your needs, or learn more about ETFs, on our ETF Insights page.
• Compare funds and ETFs side by side and easily follow their valuations, ratings, and fees.

This article was compiled by Bella Albrecht, edited by Lauren Solberg, and reviewed by Andrew Willis.

This article was generated with the help of automation and reviewed by Morningstar editors. Learn more about Morningstar’s use of automation.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar's editorial policies.