Vanguard vs. iShares All-in-One ETFs

All-in-one ETFs are giving robo advisors a run for their money with their ease of use and low fees. All-in-one ETFs contain multiple ETFs, which means in one single purchase, you are essentially getting an entire well-balanced and hugely diversified portfolio at the tap of a button. 

There are many Canadian all-in-one ETFs to choose from, and Vanguard and iShares are some of the best. They top our list because of their diversification, automatic rebalancing, good mix of stocks and bonds, and low management fees.

To be honest, they are both great choices, and aren’t vastly different. iShares will give you a slightly lower MER and Vanguard beats iShares in the number of all-in-one ETFs you can choose from as well as offers a bit more exposure to US bonds and emerging markets. 

In this Vanguard vs. iShares All-in-One ETFs comparison, we’ll have a look at their holdings, fees and more so you can understand how they differ and which might be the next best investment for you.

Are You Saving Enough for Retirement?

Answer your retirement savings questions with 4 Steps to a Worry-Free Retirement. The first online course for Canadian retirement.

Try Worry Free Retire with 100% Money Back Guarantee

Vanguard All-in-One ETFs

Here are the three Vanguard ETFs straight from the Vanguard website. They each have a MER of 0.25%.

iShares All-in-One ETFs

As you can see from the table below, even the ticker symbols are similar!  However, these iShares ETFs are cheaper with a 20% MER, .04% less than Vanguard’s all-in-one ETFs. 

It’s a great time to be an investor where you can build a completely hands-off indexed portfolio by purchasing a single ETF and paying only 0.20% in fees. It can get even cheaper if you go with a discount brokerage that offers commission-free ETF purchases.

The biggest difference that I can see right now is that iShares does not offer a conservative portfolio (like Vanguard above), but they go head to head in the balanced and growth portfolios.

Comparing Holdings

Below you can find detailed comparisons of various selected ETFs by both companies.

XBAL vs. VBAL

Comparing the holdings of these two leading ETF providers show that there is little difference in the exposure and holdings. With XBAL, you’ll get slightly more exposure to the US market and slightly less exposure to Canada.  In the grand scheme of things, that may not be a bad thing since Canadians have a tendency to have a home bias (myself included).

With VBAL, you’ll get slightly better diversification with your bonds portfolio with exposure to the US and global bonds.  However, XBAL gives you more exposure to corporate bonds. With only a 0.04% difference in MER, it’s a tough choice, but if I were to start a portfolio today, it would lean towards XBAL.

XGRO vs. VGRO

Comparing the iShares and Vanguard all-in-one growth ETFs, again, there are slight differences.  iShares gives you more US equity exposure (36.5% vs 31%) and less Canadian equity (20.51% vs 23.2%).  Vanguard, on the other hand, gives you better global exposure to bonds.  However, this is less important as bonds are only 20% of these portfolios.

Both are strong portfolios, but I like that XGRO has slightly greater global equity exposure. Read our VGRO review for the full details.

VEQT vs XEQT

Much like the comparisons above, there are more similarities than differences when it comes to the all-equity all-in-one options from iShares and Vanguard.  iShares continues to give a little more weight to the USA exposure over the Canadian side of things, with virtually equal weighting given to the international scene.

What it essentially boils down to here is whether you like the extra diversification of the US market versus the steady-as-she-goes world of Canadian equities. You can read our detailed XEQT review or VEQT review for more details on each.

I’m not going to bother going into detail on the new ultra-conservative all-in-one ETFs from both companies, because there are very few differences between them as they are essentially basic income-generating portfolios. I honestly think I’d rather just opt to place my money in a high interest savings account at EQ Bank as opposed to bothering with either option.

iShares vs Vanguard All-in-One ETFs FAQ

Can I buy iShares or Vanguard ETFs through Questrade or Virtual Brokers?

Yes! And you will pay exactly $0 to do so!  (There are small fees applicable when you sell these ETFs, but most investors won’t be doing that for 20+ years – when they will represent a very minimal fee for your overall portfolio.)

Are iShares and Vanguard ETFs as Good as Robo Advisors?

Both iShares and Vanguard ETFs use the same passive index investing strategy as the main robo advisors.  In some cases, the underlying ETFs are even exactly the same!  The differences come in terms of price and investor help.  You’ll pay a little bit more to use a robo advisor (roughly .3% more) but you’ll also have access to more advice should you need it.

Are All-in-One ETFs Safe?

No investment is ever “safe” when it comes to risk-proof returns.  All equity and bond investments will go up and down with the markets.  That said, using a discount brokerage to purchase these ETFs is extremely safe from a fraudulent or theft situation.  Also, instantly diversifying your investment dollar into thousands of companies and bonds from around the world, your money is statistically much safer from a dramatic investment loss than it could be in a mutual fund, or a few hand-picked stocks.

Is It Easy and/or Simple to Invest With Vanguard or iShares All-in-One ETFs?

Yes!  After you setup your online broker account, you can literally commit less than 30 minutes per year to your investment portfolio using these products.  If you simply decide on your risk level, and then purchase the corresponding all-in-one ETF, you will beat the returns of the vast majority of investors out there – simply by not doing psychologically-destructive things to your portfolio!  Every few months, you simply transfer money from your bank account to your discount brokerage account, then log in, purchase your one ETF, and log out again.  It is that simple.

Final Thoughts

All things considered, an all-in-one portfolio ETFs are definitely great investments for those that crave a fully passive investment strategy. 

Both Vanguard and iShares all-in-one ETFs offer excellent geographic and sector diversification, having thousands of stocks and bonds included as part of the package. Throw on top of that low MERs, free trading if you have a brokerage account with a discount broker that offers commission-free ETFs, and automatic rebalancing, these ETF portfolios really have it all. 

It will really come down to how much cutting costs to the bare minimum matters to you. With iShares, you’ll save 0.04% when compared to Vanguard. However, if you would like more of a US heavy selection of ETF portfolios, Vanguard may be more suitable. 

If you would like to find out more about All-in-One ETFs, check out our article on The Best All-in-One ETFs in Canada. If you prefer the idea of choosing your own ETFs rather than an all-in-one ETF portfolio, head to our write up on the 45 Best ETFs in Canada. 

Ready to make your first all-in-one ETF purchase? Check out our reviews of Questrade, Qtrade or Virtual Brokers, all of which offer free ETF purchases.