Canadian blue chip stocks beat the market. OK, they crush the market historically. That’s good news for Canadian investors who build their own stock portfolio. We just have to buy enough of ’em and get out of our own way. Of course, we’ll need to invest within our risk tolerance level and diversify geographically. Exchange traded funds (ETFs) make is so easy to cover off the U.S. and international markets. We can often enter one ticker symbol and press Buy to do that. Successful investing and wealth creation is so easy. With November in the books, we’ll take a look at the performance of the Beat The TSX Portfolio and a Canadian Wide Moat model. Plus, the Sunday Reads.
Before we get to the Beat The TSX Portfolio, let’s go back to that Canadian blue chip stocks outperformance ‘thing’. And here’s the killer chart …
We can buy the big blue chips or do even a little better with big dividends and low volatility. The low vol slant is essentially the Canadian Wide Moat approach. You invest in the wide moat sectors of financials, grocers, railways and utilities (including pipelines and telcos. Outperforming the market by 3.5% annual is massive. Beating the market with lower volatility is even better. Of course, past performance does not guarantee future returns.
You can grab the Canadian Low Volatility space with BMO’s ZLB-T.
You don’t have to build your own stock portfolio
I’m not going to tell you how to invest. I’ll just put some facts and historical performance on the table. You will choose the style that suits your needs and investor personality.
You don’t have to pick individual stocks to be a very successful investor You can invest in core index ETFs.
The Canadian asset allocation ETFs are managed, well-diversified global portfolios, available in one fund. That link offers the performance of the asset allocation ETF providers and compares the performance by risk level. A table shows you how to match the portfolios to your time horizon and risk tolerance. Hit the Contact Dale button on the top of the page if you want help on portfolio selection. I’m happy to help, for karma.
Beat The TSX Portfolio
First we’ll take a look at the the Beat The TSX Portfolio in 2025. Here’s the performance until the end of November.
The BTSX (hypothetical ticker, there is no fund for this approach) was trying to outperform, but the drastic out-performance of the materials sector XMA-T has pushed the market index ETFs XIC-T higher. All said, 27% to 30% returns are just ridiculous.
Canadian stocks are out-performing U.S. stocks, XUS-T up 14.1% in 2025 (in Canadian Dollars).
Check out the blazingly simple Canadian portfolio.
Here’s the performance of the 10 stocks in the Canadian Wide Moat Portfolio, for 2o25.
What a mixed bag, with the crushed telcos under-performing while former bad boys Algonquin Power and TD bank soar. The BTSX approach goes value-hunting. Sometimes it wins, sometimes it losses. Sometimes it wins and losses at the same time as 2025 demonstrates.
The Canadian telco stocks are a firm reminder that past performance does not guarantee future returns. While I had suggested that the bottom might be in for Canadian telco, we should admit that it is now a no-growth to very slow-growth sector. Perhaps the best we can hope for is a solid and profitable sector. Hopefully the sector becomes boring but reliable.
From the time of Bell’s much-needed dividend cut and ‘bottom in ‘ suggestion/guess.
Taking tolls on North American oil and gas
I’ve been over-weighting to the Canadian pipeline stocks. I sure hope history repeats, ha …
Net, net, while the Beat The TSX Portfolio has a long-tracked history of crushing the TSX, it’s a wild ride at times, and perhaps too much for most investors. I’m of the opinion that we should hold more of the sectors that the BTSX gravitates to. That is, more of the Canadian Wide Most “stuff”. More utilities, more of the banks (and other financials), add the wonderful Canadian grocers XST-T. Add in the cyclical (more economically-sensitive) railways if you’re in the accumulation stage.
Building a Canadian blue chip portfolio
For over a decade my wife’s Canadian Dollar RRSP held Vanguard’s High Dividend ETF – VDY. Thanks to a drastic over-weight to Canadian financials it beat the TSX by about 1% annual. As my wife approaches retirement I wanted to shade the equity portion of the portfolio to a more defensive posture. Creating a stock portfolio allows for more control, though it is all certainly doable by way of ETFs.
Be sure to check out Retirement Club
Here’s the portfolio and approximate weighting. I have not rebalanced, new monies and dividend reinvestment has been directed towards the pipelines, RBC, consumer staples and Quebecor.
The mix has slightly bested the TSX 60 with lower volatility.
The individual assets
My wife’s actual performance is slightly better than the above due to monies going to winners such as RBC, TC Energy, Enbridge, and Quebecor. We also bailed on Telus a few months ago. It continues to fall. Her telco exposure is down to Quebecor and the telco holdings in HUTS-T, the ‘total’ Canadian utilities ETF with modest leverage.
More on Canadian energy
In our Canadian accounts we also hold Canadian oil and gas stocks. The performance from late 2020 has been truly incredible. That is part of our inflation-hedge. Canadians can look to the Purpose Real Asset ETF, PRA-T that is a one-stop shop of inflation fighters.
In the above look at my wife’s portfolio I wanted to demonstrate the performance of the blue chip stuff, and what can happen when you build a (real life) Canadian blue chip portfolio. I’ll continue to track that portfolio for you. And certainly there has been no real test. Canadian stocks continue to fly and I’m surprised that the blue chip portfolio can keep up. The real test will come during a severe market correction and the next recession. There’s not much to see here, yet.
As my wife approaches retirement, I will build up more of the defensive consumer staples, pipelines, and HUTS, while also building positions in individual traditional utilities such as Fortis, Emera, Hydro One, Canadian Utilities, Alta Gas and Brookfield Renewable Partners.
The defensive equities will work in concert with the cash CBIL-T and bonds XBB-T. That allocation is near 20% in total. Just for fun here’s Joan’s 80/20 mix vs XGRO-T, a balanced growth asset allocation ETF.
Of course, XGRO is a global balanced growth portfolio. We also hold U.S. and international equities. And even on that front I slant toward a more defensive posture.
The Sunday Reads
At Findependence Hub experts opine on various tweaks to Bengen’s famous 4% rule.
Bengen himself has given that spend rate a boost up to 4.7% after we add additional investment assets compared to core markets and core bonds. For the go-to post and chart for Canadian retirees check out …
Creating retirement income from your portfolio.
Thanks to Norm Rothery for that wonderful research. Check out the post link for how to read that chart. Use Contact Dale if you have further questions, or if that chart is still a head-scratcher.
And keep in mind that we usually throw out the 4% rule once we embrace an optimized cash flow plan. We’ll teach you how to ‘do that’ at Retirement Club. Check out a cash flow example …
Can you retire with a $1,000,000 portfolio in Canada?
Where’s the sales?
And U.S. stocks have moved to the highest price to sales ratio in history, even waaaay above the dot com crash era.
On Findependence Hub I outlined what you might do if you wanted to hedge the potential of a U.S. bubble-bursting. Here’s
Challenging times for recent retirees?
It’s not advice of course, just a playbook/ideas on how a retiree might approach the valuation issue. Valuation does matter in retirement.
At Booming Encore, shifting from time scarcity to time affluence.
Some may discover the same structure that once felt oppressed actually provided a sense of purpose and identity. Without having this, their days can start to blur together, and many people experience this extra time as if they are sailing without a rutter.
As I’ve penned so many times on this blog, we need a life plan when we enter retirement, as we prepare for retirement.
At Stocktrades Dan looks at his favourite Canadian dividend growth stocks for 2026 …
And one of our favourites at Retirement Club, Parallel Wealth looks at big RRSP problems, OAS clawback, RRSP drop out rules and more.
At Million Dollar Journey, Kyle wonders if the AI bubble will pop.
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Here’s Canada’s top-performing Robo Advisor, Justwealth. You can get advice, planning and low-fee ETF portfolios all at one shop. Canadians can have it all.
Consider Justwealth for RESP accounts. That is THE option in Canada with target date funds that adjust the risk level as the student approaches the College or University start date.
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Make your cash work a lot harder at EQ Bank. RRSP and TFSA account rates are at 1.75%, other savings rates up to 3.0%. You’ll find some higher rates on GICs up to 3.60%. They also offer U.S. dollar accounts at 3.0%. We use EQ Bank, they have been awesome.
OUR CASHBACK CREDIT CARD
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For October we received $43.41 in cash from everyday spending. You can select 3 categories for 2.0% cash back. Remaining categories pay up at 0.50%.
That cash went into my TFSA account to help buy some CBIL-T, CHPS-T and HURA-T.
Join us at Retirement Club today
Do retirement right. … a series of monthly Zoom Presentations, newsletters, plus a secure and private online space where we learn, share ideas and connect with members. Here’s the Retirement Club overview page. New members are signing up now. You’ll join Retirement Club Group Two for the last two Zoom presentations of 2025, and then carry on with the full Group Three in January of 2026.
In December Jason Heath of Objective Partners will take us through some of the estate planning basics.
Make sure you’re doing retirement right. It’s also suitable for those who are approaching retirement. Use Contact Dale if you’d like more info, or to sign up.
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Thanks for the great blog post, Dale. I have noticed you frequently mention PRA ETF as an inflation fighter. When I look for more info on PRA, I find it difficult to understand what is in it and what the MER is. Chat gpt says the MER is 1%, which seems high given all the great ETFs out there with far lower fees. Can you comment on the contents of PRA and the MER? I know we could all benefit from learning more about this product ….Might even be a great future blog post!:) thanks for all the great blogs you post!
Thanks Patrick. Yes, I think a dedicated post for PRA is in order. Thanks for the suggestion and thanks for stopping by.
Dale