ZAG at a Glance
| Feature |
Details |
| Full name |
BMO Aggregate Bond Index ETF |
| Ticker |
ZAG |
| Provider |
BMO Global Asset Management |
| Inception |
January 2010 |
| MER |
0.09% |
| Yield to maturity |
~3.8% |
| Distribution frequency |
Monthly |
| Duration |
~7.5 years |
| Number of holdings |
1,500+ bonds |
| AUM |
$8B+ |
| Exchange |
TSX |
Holdings Breakdown
| Bond Type |
Weight |
| Government of Canada |
~35% |
| Provincial bonds |
~25% |
| Investment-grade corporate |
~30% |
| Municipal & other |
~10% |
| Credit Quality |
Weight |
| AAA |
~40% |
| AA |
~25% |
| A |
~20% |
| BBB |
~15% |
Monthly Income
| Investment |
Annual Income (~3.8%) |
Monthly Income |
| $50,000 |
$1,900 |
$158 |
| $100,000 |
$3,800 |
$317 |
| $200,000 |
$7,600 |
$633 |
| $500,000 |
$19,000 |
$1,583 |
ZAG vs Alternatives
| Feature |
ZAG |
VAB |
XBB |
ZDB |
| MER |
0.09% |
0.09% |
0.10% |
0.09% |
| Index |
FTSE Canada Universe Bond |
FTSE Canada Universe Bond |
FTSE Canada Universe Bond |
Discount bond |
| Duration |
~7.5 years |
~7.5 years |
~7.5 years |
~7 years |
| Tax efficiency |
Standard |
Standard |
Standard |
Better (more capital gains) |
| AUM |
$8B+ |
$5B+ |
$4B+ |
$1B+ |
ZAG vs GICs
| Feature |
ZAG |
5-Year GIC |
| Return |
~3.5-4.0% + potential capital gains |
4.0-4.5% guaranteed |
| Liquidity |
✅ Sell anytime |
❌ Locked for term |
| CDIC insured |
❌ |
✅ Up to $100K |
| Price risk |
✅ Can lose value |
❌ No price risk |
| Benefit when rates fall |
✅ Bond prices rise |
❌ Locked at old rate |
Who Should Hold ZAG
| Profile |
Suitable? |
| Fixed-income portion of balanced portfolio |
✅ Ideal |
| Want monthly income from bonds |
✅ Yes |
| Believe rates will fall (bond prices rise) |
✅ Good opportunity |
| Want guaranteed return |
❌ Use GICs |
| Short-term savings (1-2 years) |
⚠️ GIC or HISA may be better |