Can one ETF really provide a complete portfolio? Learn how all-in-one ETFs work, how to choose the right risk level and what to consider before investing.
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Étienne Joncas-Bouchard, director of ETF and Alternative Strategy at Fidelity Investments Canada ULC.
You’ve heard all the arguments for creating your own DIY investment portfolio: the potential savings on fees (especially important for new and smaller investors), the ease of using exchange-traded funds (ETFs), and the ability to build and manage a portfolio on your own terms.
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Still, the responsibility of opening your own brokerage account and populating it with ETFs that will help you reach your goals can be daunting. There are more than 2,000 ETFs trading in Canada and thousands more around the world. How do you know if you’ve picked the right ones? Will they work together to strike the right balance between acceptable risk and decent returns? And how will you know when it’s time to make changes?
Fortunately, there is a solution to this decision paralysis: the asset allocation or all-in-one ETF. These are ETFs designed to offer a broadly diversified portfolio in a single investment. They first appeared in Canada in 2019.
According to a recent study, there are now 122 ETFs invested in multiple asset classes trading in Canada as of September 1, 2026, and they represent 11% of total ETF assets under management with a market value exceeding $100 billion. Canadian investors have certainly bought into the concept.
How do all-in-one ETFs work?
Asset allocation ETFs are generally funds of funds—instead of investing directly in stocks, bonds, and other assets directly, they invest in funds offering exposure to specific asset classes and geographies, such as Canadian bonds and U.S. or international stocks. Because these funds tend to belong to the same fund family, there is no duplication of fees; you pay a single management expense ratio (MER), expressed as a percentage of your holdings, for the whole fund.
For example, Fidelity offers all-in-one ETFs that combine exposure to multiple asset classes, regions, and sectors in a single fund. The funds are designed to give you a diversified portfolio without requiring you to select and manage several ETFs yourself.
“There are so many choices available for Canadians, which is a good problem to have,” says Étienne Joncas-Bouchard, Director ETF and Alternative Strategy at Fidelity Investments Canada ULC. “When you start to build a portfolio, the most important thing is figuring out: what am I looking for to help me achieve my goals? What type of risk am I willing to take?”
For the most part, all-in-one funds are meant to provide a complete portfolio solution for a particular kind of investor and account type. A young investor saving for a retirement that is decades in the future can afford to take on risk in the hope of higher returns. For them, an appropriate asset mix will be heavily or even entirely dedicated to equity holdings. Someone with a shorter time horizon, such as a couple building up a down payment in a first home savings account (FHSA), will likely opt for a conservative asset allocation that includes an ample dose of fixed income.
Fund companies usually issue a series of asset allocation ETFs appropriate for investors all along this risk-return spectrum, from conservative 80% fixed-income/20% equity funds to 100% stock funds. They might also offer income-oriented funds designed to spin off a mix of dividend and interest income for retirees without diminishing their asset base.
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If you don’t need the income right now, you can usually enable a dividend reinvestment plan (DRIP) to ensure the income generated by your all-in-one ETF gets reinvested in more units of the fund without incurring a trading fee. This way, you can take full advantage of the wealth-building benefits of compounding.
Which all-in-one ETF should you buy?
The most important consideration should be getting your risk profile right. All other considerations are secondary, including the fund company, fee level, active vs. passive management, and exposure to alternative asset classes.
Begin by looking at your own risk tolerance and the purpose of the account. Would you be OK with a portfolio loss of 20% or more in a year, knowing that it will likely recover (and then some) by the time you need to draw from the account? The shorter the time horizon, the more conservative your strategy should be.
Now, take the time to read through the prospectuses and fact sheets of suitable ETFs on various fund companies’ websites. Try to find an ETF that sounds right for you. Check what third parties like MoneySense, Morningstar, your own brokerage, and even Reddit have to say about the fund.
One of the biggest misconceptions about all-in-one ETFs is that holding a single fund means sacrificing diversification. “Just because you hold only one ETF doesn’t mean you’re not diversified,” explains Joncas-Bouchard.
But the beauty of ETFs is their liquidity. If, after holding a fund for a few months or years, you find that it’s not performing the way you want it to, you can instantaneously sell it and reinvest the proceeds in a different ETF. You are not making a long-term commitment; there are no forms to submit.
You can also change the emphasis of your portfolio over time—for example, making a registered education savings plan (RESP) aim to preserve capital as your child’s high-school graduation approaches. Or you can combine your core holding with other ETFs or even stocks as your confidence in your own investing skills increases.
A set-it-and-review-it approach
Perhaps the greatest attribute of all-in-one funds is that you don’t have to concern yourself with how the stock market is doing today and whether you should tinker with your holdings.
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“That’s the beauty of all-in-one ETFs—you don’t have to know when and how to rebalance because the asset manager is doing that for you,” said Joncas-Bouchard.
These days, DIY investing has become more accessible with the help of AI. For very modest fees, you can get an all-in-one ETF portfolio that fits your needs and can be altered as those needs change. For investors starting out, they represent a great opportunity to get ahead.
To find out more about Fidelity All-in-One ETFs, visit fidelity.ca.
The statements contained herein are based on information believed to be reliable and are provided for information purposes only. Where such information is based in whole or in part on information provided by third parties, we cannot guarantee that it is accurate, complete or current at all times. It does not provide investment, tax or legal advice, and is not an offer or solicitation to buy. Graphs and charts are used for illustrative purposes only and do not reflect future values or returns on investment of any fund or portfolio. Particular investment strategies should be evaluated according to an investor’s investment objectives and tolerance for risk. Fidelity Investments Canada ULC and its affiliates and related entities are not liable for any errors or omissions in the information or for any loss or damage suffered.
Michael is a financial writer and editor in Duncan, B.C. He’s a former managing editor of Canadian Business and editorial director of Canada Wide Media. He also writes for The Globe and Mail and BCBusiness.
