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To screen for the top-performing Canadian equity funds, we looked for those with the best returns over the last one-, three-, and five-year periods. Eight funds made it through the screen.
Over the last 12 months, Canadian equity funds have returned 23.57%. On an annualized rate, these have returned 13.54% over the last three years and gained 13.96% over the last five. That compares with the Morningstar Canada Index, which has returned 27.50% over the last 12 months, gained 15.81% per year over the last three years, and gained 15.26% per year over the last five years.
Canadian Equity Funds vs. the Morningstar Canada Index
Source: Morningstar Direct. Data as of June 20, 2025.
What Are Canadian Equity Funds?
Funds in this category must invest at least 90% of their equity holdings in securities domiciled in Canada, and their average market capitalization must be greater than the Canadian small-/mid-cap threshold, according to the Canadian Investment Funds Standards Committee.
Screening for the Top-Performing Canadian Equity Funds
To find the best Canadian equity funds, we looked at returns data from the past one, three, and five years using data in Morningstar Direct. We screened for Canada-domiciled open-ended and exchange-traded funds in the top 33% of the category using their lowest-cost primary share classes for those periods. We also filtered for funds with a Morningstar Medalist Rating of Bronze, Silver, or Gold. We excluded funds with assets under C$100 million. This left eight names.
Because the screen was created with the lowest-cost share class for each fund, some may be listed with share classes that are not accessible to individual investors, or they may be aimed at institutional investors and require large minimum investments. The individual investor versions of those funds may carry higher fees, reducing returns to shareholders. In addition, Medalist Ratings may differ among the share classes of a fund.
CI Morningstar Canada Value Index ETF
Over the past year, the C$305.8 million CI Morningstar Canada Value Index ETF rose 34.66%, while the average fund in its category rose 23.57%. The CI Investments fund, launched in February 2012, has climbed 15.76% over the past three years and 18.60% over the past five.
CI Morningstar Canada Momentum Index ETF
Over the past year, the C$597.3 million CI Morningstar Canada Momentum Index ETF rose 39.24%, while the average fund in its category rose 23.57%. The CI Investments fund, launched in February 2012, has climbed 17.38% over the past three years and 15.73% over the past five.
DFA Canadian Vector Equity Fund
The C$1.2 billion fund has climbed 26.94% over the past year, outperforming the average fund in its category, which rose 23.57%. The Dimensional fund, launched in July 2011, has climbed 15.54% over the past three years and 20.12% over the past five.
RBC QUBE Canadian Equity Fund
The C$2.4 billion fund has climbed 29.29% over the past year, outperforming the average fund in its category, which rose 23.57%. The RBC fund, launched in August 2018, has climbed 15.98% over the past three years and 15.01% over the past five years.
RBC QUBE Low Volatility Canadian Equity Fund
Over the past year, the C$3.8 billion fund has gained 27.02%, while the average fund in its category is up 23.57%. The RBC fund, which launched in November 2012, has climbed 14.96% over the past three years and gained 14.90% over the past five years.
Canadian Equity Fund
Over the past year, the C$1.4 billion fund has gained 30.10%, while the average fund in its category is up 23.57%. The SEI fund, launched in May 2006, has climbed 15.57% over the past three years and 16.25% over the past five.
Vanguard FTSE Canada All Cap Index ETF
Over the past year, the C$9.6 billion fund has gained 26.69%, while the average fund in its category is up 23.57%. The Vanguard fund, which launched in August 2013, has climbed 15.23% over the past three years and gained 15.04% over the past five years.
“Vanguard FTSE Canada All Cap ETF offers broad exposure to the Canadian stock market at a low price, a simple formula that few have been able to beat in the long run.”
“The shape of this index fund looks a lot like the average portfolio in the Canadian equity Morningstar Category. Its average holding is a bit larger than the category average, but the portfolios sport nearly identical sector compositions and value-growth orientations. Mirroring the category norm indicates that this fund captures the full opportunity set available to its active peers. It also means that the fund maximizes the impact of its cost advantage, a reliable engine for sound category-relative performance.
“This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Market-cap weighting channels the market’s collective view on the relative value of each holding, allowing the fund to coast on the research of the crowd without running up its own expenses. It also requires little turnover, a benefit that’s complemented by index buffers designed to cut back on trading costs.
“Tracking nearly the entire Canadian stock market makes this a reasonably well-diversified fund. It normally tallies around 170 holdings, the top 10 of which represented between 35% and 40% of the portfolio over the past three years. That’s a higher share than the category average but on par with the Morningstar Canada Index, its category benchmark. Sweeping in mid- and small-cap stocks can present an edge when large caps fall out of favor.
“Concentration problems do surface at the sector level, though. Heavy stakes in financials (33% of assets as of August 2024) and energy (17%) tend to soak up about half the portfolio. These biases reflect the composition of the Canadian market rather than this strategy. Still, it may hurt the fund when those sectors—or even certain industries within them—face challenges.”
—Ryan Jackson, senior analyst
Vanguard FTSE Canada Index ETF
Over the past year, the C$2.3 billion Vanguard FTSE Canada Index ETF rose 26.90%, while the average fund in its category rose 23.57%. The Vanguard fund, launched in November 2011, has climbed 15.02% over the past three years and 15.24% over the past five.
“Vanguard FTSE Canada ETF offers market-cap weighted exposure to the Canadian large- and mid-cap stock market at a low price, a simple formula that should be hard to beat in the long run.
“Save for its larger market-cap orientation, this index strategy looks a lot like the average portfolio in the Canadian equity Morningstar Category. The portfolios sport similar sector compositions and value-growth bents. Mimicking the category norm indicates that this fund captures most of the opportunity set available to its active peers. That amplifies the impact of its cost advantage, a reliable engine for category-relative performance.
“This strategy weights stocks by market capitalization, a cost-efficient and proven approach. Market-cap weighting channels the market’s collective view on each holding’s relative value, allowing the fund to coast on the research of the crowd without running up its own expenses. It also requires little turnover, a benefit that’s complemented by index buffers designed to limit turnover and the accompanying trading costs.
“This fund sweeps in stocks representing the largest 86% of the market, a scope that usually admits somewhere between 45 and 55 holdings. The top 10 of those represented between 45% and 52% of the portfolio over the past three years. That’s a higher share than the category average, but the pedigree of the franchises atop the portfolio dials back firm-specific risk.
“Sector-level concentration is more of a reason to pause. Heavy stakes in financials (39% of assets as of August 2024) and energy (19%) regularly soak up more than half the portfolio. These biases reflect the composition of the Canadian large-cap market rather than this strategy. Still, it may hurt the fund when those sectors—or even certain industries within them—face challenges.”
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.