The capital positive factors and dividend distributions earned inside a Tax-Free Financial savings Account (TFSA) develop tax-free, making it an excellent place to carry investments you intend to maintain for years. Whereas particular person shares may ship robust returns, exchange-traded funds (ETFs) supply prompt diversification and require much less ongoing upkeep.
If I had been constructing a TFSA portfolio to compound for many years, these three Canadian-listed ETFs can be close to the highest of my buy-and-hold listing.
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BMO Canadian Dividend ETF
Buyers on the lookout for a mixture of revenue and long-term progress could discover loads to love concerning the BMO Canadian Dividend ETF (TSX:ZDV). The fund is designed to put money into Canadian dividend-paying shares utilizing a rules-based strategy that considers dividend progress, yield, and payout ratios.
What makes ZDV much more enticing for TFSA traders is its deal with established Canadian companies with confirmed dividend-paying histories. Many of those corporations function in sectors that generate dependable money flows, serving to assist each distributions and long-term capital appreciation.
ZDV holds 65 securities and is closely weighted towards monetary and power shares, which collectively account for greater than 60% of its portfolio. Its largest positions embrace large-caps like Royal Financial institution of Canada, Toronto-Dominion Financial institution, Enbridge, Canadian Imperial Financial institution of Commerce, and Canadian Pure Assets.
BMO Canadian Dividend ETF at present gives month-to-month distributions with a 2.7% yield and has a administration expense ratio (MER) of 0.39%. It has additionally delivered stable efficiency, delivering a 41.5% return in only one yr as of April 30.
iShares S&P/TSX Canadian Dividend Aristocrats Index ETF
For traders who worth consistency, the iShares S&P/TSX Canadian Dividend Aristocrats Index ETF (TSX:CDZ) can be price contemplating.
This fund tracks an index of Canadian shares which have raised their abnormal money dividends yearly for a minimum of 5 consecutive years. That requirement naturally helps it embrace solely the companies with secure operations and a shareholder-friendly strategy.
CDZ ETF at present holds 96 shares and gives broad diversification throughout sectors, with power representing its largest sector allocation, adopted by financials, industrials, utilities, and actual property. Its prime holdings embrace South Bow, TELUS, Gibson Power, Westshore Terminals Funding, Enbridge, and Canadian Pure Assets.
The ETF distributes revenue month-to-month and gives a distribution yield of roughly 3.1%. Curiously, since its launch in 2006, a $10,000 TFSA funding would have grown to just about $48,000 by April 2026 with distributions reinvested.
BMO Nasdaq 100 Fairness Hedged to CAD Index ETF
Whereas dividend ETFs can present stability, each long-term TFSA portfolio must also have some publicity to progress shares. That’s precisely what the BMO Nasdaq 100 Fairness Hedged to CAD Index ETF (TSX:ZQQ) gives. As of April 2026, ZQQ ETF generated annualized returns of 25.8% over three years.
ZQQ ETF goals to copy the efficiency of the Nasdaq-100 Index whereas hedging U.S. greenback publicity again to the Canadian greenback. The ETF offers traders entry to lots of the world’s largest expertise and innovation-driven corporations with out having to purchase particular person U.S. shares.
The tech sector accounts for greater than 53% of its portfolio, whereas communication providers and client discretionary shares additionally maintain giant weightings. Its largest holdings embrace American giants like Nvidia, Apple, Microsoft, Amazon, Alphabet, Broadcom, Tesla, Meta Platforms, and Walmart.
Not like the opposite two ETFs, ZQQ isn’t constructed primarily for revenue. As an alternative, it gives publicity to corporations main main traits resembling synthetic intelligence (AI), cloud computing, digital promoting, and e-commerce. For TFSA traders with a long-term strategy, that progress potential might be troublesome to disregard.
