XIT:CC - The TSX Is Soaring: 3 No-Brainer ETFs to Buy Right Now
2025-08-13 21:30:00 ET
Despite a shaky start to the year, the TSX Composite Index continues to make new all-time highs in 2025. Cooling inflationary pressures and better-than-expected economic growth prospects are giving investors plenty to cheer about.
With the economy holding steady and confidence creeping back, now might be the time to look at broad-based opportunities rather than betting heavily on one or two names. Exchange-traded funds (ETFs) make that possible by packaging top Canadian stocks into a single investment you can buy with a click. You get diversification, reduced single-stock risk, and exposure to entire sectors moving in the right direction. Let’s take a closer look at three top Canadian ETFs that offer a smart way to invest in this TSX rally.
BMO Equal Weight Banks Index ETF
If you want a straightforward way to invest in the Canadian banking sector , BMO Equal Weight Banks Index ETF ( TSX:ZEB ) delivers exactly that. It focuses entirely on Canada’s largest banks, holding National Bank , Canadian Imperial Bank of Commerce , Toronto-Dominion Bank , Royal Bank of Canada , Bank of Nova Scotia , and Bank of Montréal in equal proportions.
As of June 30, 2025, ZEB ETF traded with net assets of nearly $4 billion and offered a 3.8% annualized distribution yield. In the 12 months ended in June 2025, it delivered a 37% return, benefiting from falling interest rates and a rebound in loan growth.
The strong performance was fueled by robust earnings across the sector, improving credit quality, and better-than-expected economic data. Each bank has been supported by higher fee-based revenue and stable mortgage demand.
Overall, the Canadian banking sector’s long history of stability, combined with continued dividend growth and expansion into wealth management and digital banking, makes ZEB a solid ETF pick for seeking stable returns while riding the TSX’s bullish momentum.
iShares S&P/TSX Capped Information Technology Index ETF
From traditional finance, let’s move to Canada’s fast-growing technology stocks . iShares S&P/TSX Capped Information Technology Index ETF ( TSX:XIT ) mirrors the performance of Canada’s top tech companies, including Shopify , Constellation Software , CGI , and Celestica .
At the end of June 2025, this ETF managed $590 million in assets and posted a massive 37.8% return over the past year.
The ETF’s surge was mainly powered by strong earnings from its top holdings. Shopify continued its growth in e-commerce solutions, Constellation Software expanded through acquisitions, and Celestica benefited from rising demand in electronics manufacturing. These trends pushed the fund’s price-to-earnings ratio to around 43, reflecting the market’s high-growth expectations.
With Canada’s tech sector expanding into artificial intelligence , cloud solutions, and advanced manufacturing, XIT ETF offers a targeted way to tap into long-term innovation trends while keeping diversification within the sector.
iShares S&P/TSX 60 Index ETF
My last ETF pick offers instant exposure to Canada’s top large-cap stocks . iShares S&P/TSX 60 Index ETF ( TSX:XIU ) is the country’s largest and most liquid ETF, with $16.9 billion in assets as of June 30. It currently holds 61 companies, including RBC, TD, Enbridge , Shopify, and Canadian Pacific Kansas City . The ETF returned 26% in the 12 months ended in June 2025 and currently offers a 2.7% distribution yield.
Its recent performance is mainly supported by strength in the banking, energy, and technology sectors. Its reliable quarterly distributions make it even more attractive for income-focused investors, while the diversified holdings reduce the risk of sector-specific downturns.
For investors wanting one core holding to anchor their portfolio during the TSX’s record-breaking run, XIU remains a dependable choice among the top Canadian ETFs to buy in 2025.
The post The TSX Is Soaring: 3 No-Brainer ETFs to Buy Right Now appeared first on The Motley Fool Canada .
Fool contributor Jitendra Parashar has positions in Bank Of Montreal, Celestica, Enbridge, Shopify, and Toronto-Dominion Bank. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Bank Of Nova Scotia, CGI, Canadian Pacific Kansas City, Constellation Software, and Enbridge. The Motley Fool has a disclosure policy .
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