OK, before you hit that unfollow button I am not suggesting that Canada’s largest mutual fund is great. That said, even with the high fees the returns have been solid. Many Canadians have been able to build considerable wealth in some of Canada’s largest mutual funds. Let’s start with a look at the RBC Select Balanced Portfolio. It has been good but it has started to slip over the last 3 years. That can happen with actively managed funds. It should be no surprise. We’ll also look at RBC Select Conservative and the RBC Canadian Dividend Fund. And certainly you can do better by way of ETFs or building a sensible stock portfolio.
RBC Select Balanced Portfolio
It has over $60 billion in assets under management AUM. The MER is 1.67%. The last trading expense ratio listed takes the total fees to over 1.94%.
Obviously this is a very ‘long running’ mutual fund. Many mutual funds get shut down or merge due to poor performance. The mutual fund industry likes to hide their mistakes and poor performance. Easy enough to just take them out of sight. Given that, it’s possible that other funds have been merged into this popular fund.
And it did not take long to find this on the site.
- This is a continuing fund resulting from a merger effective June 27, 2014.
I will look into the history. But this should be a continuous trail of funds or switches for RBC clients or fund investors who have been in this balanced asset allocation model.
Here’s the total return table to September 2023. Every $10,000 was turned into over $106,000 from 1986.

If one was investing on a regular schedule they should have been able to build significant wealth. That wealth building would have been largely dependent upon the savings rate. Decent returns are present and accounted for.
That said, a level of underperformance has begun to surface in the last few years. When I first looked at the RBC Balanced Select Fund the returns were ‘not so bad’.
Here’s the history to end of November 2019 …


That’s not too bad. It trailed the lower fee Tangerine Balanced Portfolio in modest fashion by .4% annual over that 10 year period. There was some slight out-performance of the assets and the asset allocation compared to the simple Tangerine index-based approach. But that ‘out-performance’ is eaten up by the higher fees.
Is the fund still not so bad?
The fund has falllen on some tough times in recent years. Active management and high fees strikes again. The harder they try, the worse they do with the RBC Select Balanced Fund.

- Over the last three years the iShares Balanced ETF Portfolio (XBAL.TO) is up 7.4% compared to 5.2% for the RBC Balanced Fund.
- Over the last 5 years the iShares Balanced ETF Portfolio (XBAL.TO) is up 7.7% compared to 6.2% for the RBC Balanced Fund.
The above lists average annual returns. The underperformance is drastic.
The iShares Balanced ETF Portfolio is a Canadian Asset Allocation ETF. These are well-diversified all-in-one global funds. It’s safe to say the Asset Allocation ETFs are the best investment option available for most Canadians. The total fees are in the area of 0.20%. That’s a 90% off sale compared to typical Canadian mutual funds.
Cutting your investment fees by 90% is life changing.
Check out how to build a core ETF portfolio.
That is a considerable level of underperformance. The mutual fund has underperformed in each of 2021, 2022, 2023 and 2024. Yes, of course, it is time to leave this fund behind and move to a lower fee investment style.
Trying too hard …

It has 35 holdings. Now that’s a busy fund.
Canada’s second biggest fund
Next up we’ll look at the second largest fund in Canada. Here’s the more conservative Balanced Income portfolio model from RBC, The Select Conservative Portfolio. Sadly, Canadians have almost $40 billion in this mutual fund.
The Select Conservative Portfolio.

The returns for this portfolio were also quite solid when I first took a look in 2019.

Once again, the fees can get in the way in modest fashion. But a Canadian would have been able to create decent wealth in this conservative model over time.
The returns update to January 2025
The RBC Select Conservative Fund has also slipped in recent years.

Cash and GICs would have beat this fund over the last 3 years and 5 years. We have seen some tough times recently for a Conservative Balanced portfolio model.
- Over the last three years the iShares Conservative ETF Portfolio (XCNS.TO) is up 5.1% compared to 3.7% for the RBC Conservative Fund.
- Over the last 5 years the iShares Conservative ETF Portfolio (XCNS.TO) is up 5.4% compared to 4.4% for the RBC Conservative Fund.
Once again the level of underperformance is quite significant. It is time to leave the RBC Conservative Select Portfolio.
The RBC Canadian Dividend Fund
Yes, even mutual fund investors like their big dividends.
The returns have been lackluster. Investors are handing over a generous portion of the dividends and returns to RBC, and well, to me too as I am a RBC shareholder. Stop giving me your money, please. Quit it, I’ll be OK. 😉
Sadly, there is over $20 billion in the RBC Canadian Dividend Fund.
Here’s the initial evaluation from 2019.

That fund was under-performing by about 2% annual. That is significant of course. The simple TSX 60 ETF XIU delivered 7% annual over that 10 year period.
On the dividend ETF front you might have a read of my review of Vanguard’s VDY vs iShares XEI.
Here is the returns update to January 2025. I have offered a comparison to Vanguard’s Big Dividend VDY. Well, there is no comparison.

- RBC Dividend 3-year 7.0%
- Vanguard VDY 3-year 8.1%
- RBC Dividend 5-year 9.3%
- Vanguard VDY 5-year 12.1%
- RBC Dividend 10-year 7.6%
- Vanguard VDY 10-year 9.5%
If you want some help or information on how to switch from high-fee mutual funds (RBC or otherwise) feel free to send me a note. Simply click on Contact Dale at the top of this post. I am more than happy 🙂 to help.
It is time to leave the RBC Canadian Dividend Fund behind.
Portfolio reviews
If you’d like a portfolio review of your investments, I can do that as well for a very modest fee. We are likely to put a number on the considerable amount of (additional) wealth building you’d be able to undertake by leaving your high fee mutual funds. Retirees are likely to learn how they might increase their retirement income by 50% to 100%.
Rob Carrick looked at Canada’s top 100.
In June of 2018 Rob Carrick of the Globe looked at the largest 100 mutual funds in Canada. Here’s a snip of the top funds. I am assuming, given the growth in assets that the top 2 funds have held their positions.

Why do investors do so poorly?
Too often it’s bad behaviour. Investors are investing outside of their risk tolerance level. They get nervous in periods of market corrections, and they sell when the markets are down. They do not stay invested. Buy high, sell low.
When I was performing portfolio evaluations as an advisor at Tangerine Investments, I found the problem was often the fund choices of their external advisors. They were in a ragtag mess of funds all too often. There was a lot of fund switching used by advisors to create fees (for themselves). I would often witness returns well below that of savings accounts and GICs. Followers of this blog often report long period of no returns or low single digit returns obtained by their advisors (mutual fund salespersons).
Mostly, the high fees eat up the returns putting money in the wrong pockets.

Should you switch to ETFs?
To invest in ETFs you would have to self-direct your own investments. I think that’s the ideal route if you have the confidence and enough knowledge. This blog will help you learn the investment basics. Drop me a note if you’d like a tour of the site.
You can access the greater financial plan by way of an advice-only planner.
What is a Canadian Robo Advisor?
For investment advice and a managed ETF portfolio that has very reasonable fees you can go with one of the Canadian Robo Advisors.
The top ‘Robo’ Advisor in Canada is Justwealth. You can obtain advice, a financial plan and low fee investments all in one shop. Many readers of this blog have moved to Justwealth. I’ve sent family members to Justwealth, as well. You can click on the review below.
Justwealth is Canada’s top robo advisor
If you’d like a portfolio evaluation you can send me a note via that contact form. Or if you think you’re getting some ‘weird’ advice from your advisor I am happy to weigh in.
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Hi Dale
Merry Christmas
I have dumped my last 2 mutual funds -class F and now 100% in dividend paying stocks
Awesome! Big thumbs up Dan. Hope all is well. Happy Holidays.
Dale
The PH&N Balanced fund made up of a more concentrated mix of RBC and PH&N funds is available in D series with a 0.88% MER which should be available in most discount brokerages and is likely a better option. I understand you picked the RBC fund due to it’s large size, but it’s interesting that RBC has a better option they offer.
Thanks Devin, yes I was looking at the master D series list for Canadians. But if one is at a discount brokerage they might as well develop an ETF portfolio or a one ticket? I’ll do a comparison of ETF vs PH&N D series. That’s a great fund line up that RBC now owns.
There is some ph&n in the funds from this post 🙂
Dale
With a 1.94% MER and an undisclosed mgmt. fee, I would imagine TNL@RBC is profiting handsomely. I’ll pass thanks. Happy Holidays from Bonaire (Dutch Caribbean), where it’s currently 29 degreed and sunny.
Hi Rob, ha, I’m jealous. Was talking to my brother yesterday about a schedule for getting his sailboat down to the BVI’s. I’m hoping a year this Fall. Would then have to stay into that Christmas. Thanks for stopping by, and Happy Holidays.
Dale
So many Canadians put so much money into these bank mutual funds when there weren’t many other options other than individual stocks.
Now there are so many better, less expensive and more profitable ETF options out there.
Hi Marko, yes, but so many Canadians have no idea, nor do they care. They simply go to the bank and do as they’re told. That’s changing though for newer generations of investors. The tide has turned. Many will stay stuck in their bank funds. I think that’s just the way it is.
Dale
Sadly, I think you are spot on with your observations Dale 🙁
We certainly don’t give up on ’em. I used to move them over to Tangerine ‘as a job’. It was easy most of the time. We had great success. Just show them the numbers on fees and returns.
Dale
I am one of those Canadians and have very limited time to extensively research. However, I do stumble upon a good informative site like this one, from time to time. Are you able to review the PHN High Yield Bond Fund ? I’m curious to know your thoughts on it and whether it’s worth staying the course on it or not.
I will take a look, thanks.
Dale
Dale, I’m curious why there’s no mention of the Mawer Balanced Fund in your critique of mutual funds in the Canada Fund Global Neutral Balanced category. Mawer’s performance numbers far exceed those of the RBC Select Balanced Portfolio fund. Also Mawer’s fund MER is a full percentage point lower than the RBC fund.
https://www.morningstar.ca/ca/report/fund/performance.aspx?t=0P0000714D&FundServCode=MAW104@7&lang=en-CA
Hi Bernie that was just a look at the behemoths. The there here, or what I was observing is that any investors who have been in those top 2 funds for a while and were able to stay invested, the returns were surprisingly solid. So many Canadians are in those top funds. I was curious as to ‘what’s going on’. Fortunately more monies are now flowing to low fee ETFs.
I did mention Mawer in the post and the certainly have a permanent spot on my site. 🙂
I will do a Mawer post for sure. I believe you need a mil to get the funds and the advice.
Dale
Yeah its $1M minimum net worth if one wants to go the Mawer Investment Counselling route. I don’t see the need for an advisor if one is simply invested in mutual funds or ETFs. For self-directed investors, Mawer Mutual Funds are available for purchase commission free through most major online discount brokerages, with the exception of RBC Direct Investing. A minimum initial purchase of $5,000 per fund, per account is required. Once the initial minimum is met, there are no minimum requirements for additional investments. Mawer funds have lower MERs than most other mutual funds, don’t have trailer fees and typically outperform other mutual funds, ETFs and their index benchmarks. About the only thing Mawer funds don’t have are high distribution yields. Most Mawer investors would need to harvest units to enhance their income in retirement.
Thanks Bernie, yes that is an awesome company. Be boring. Make money.
A great option for sure, of course.
Dale
Returns are updated for 2020.
Dale