Best international equity ETFs for Canadian investors 2025

By Michael McCullough on May 12, 2025
Estimated reading time: 2 minutes

Canadian investors should look beyond the border for diversification, given that Canada represents just 3% of the global stock market. Here’s our best international ETFs list.

Best international equity ETFs 2025

ETF	Ticker	Management fees	MER	Holdings	Description
iShares Core MSCI EAFE IMI Index ETF	XEF	0.20%	0.22%	2,482	Market cap weights, no U.S./Canadia equity, low tracking error
Vanguard FTSE Developed All-Cap ex-North America index ETF	VIU	0.20%	0.23%	3,710	More small caps, market cap weights, no US/CAD, low tracking error
BMO MSCI EAFE Index ETF	ZEA	0.20%	0.22%	698	Similar to XEF from Canadian provider
Vanguard FTSE Emerging Markets All Cap Index ETF	VEE	0.23%	0.25%	5,951	Cheapest emerging markets fund in Canada

So, how can you best get exposure to this vast investible region, covering six continents with exchange-traded funds (ETFs)? It helps to understand the geographical terms used in the investment industry:

Global stock funds cover the planet, with no inherent exclusions. Based on market capitalization, they tend to still have a heavy U.S. representation.
International stock funds generally refer to markets outside the U.S. and Canada. International funds listed on U.S. exchanges may include a small allocation to Canadian stocks.
EAFE funds invest in stocks from Europe, Australasia and the Far East—basically developed countries overseas like the U.K., Japan and New Zealand.
Emerging market (EM) funds invest in stocks from developing countries including China, India and Mexico. (Still more presumably risky regions, such as Nigeria and Vietnam, are known as “frontier markets.”)

Even with these distinctions, there are grey areas. Certain indices tracked by index funds classify South Korea or Poland as developed economies (therefore EAFE—Europe, Australasia and the Far East), while others lump in either with emerging markets.

This year our Best ETFs in Canada judges panel gave top honours to iShares’ Core MSCI EAFE IMI Index ETF (XEF). For a modest MER, it offers exposure to thousands of stocks overseas. Our second-place finishers, Vanguard’s All-Cap ex-North America Index ETF (VIU) and BMO’s MSCI EAFE Index ETF (ZEA), promise similar developed-market coverage for a similar fee.

Tied for third was a more surprising choice, however. For a change our judges looked favourably on an emerging market fund, Vanguard’s FTSE Emerging Markets All Cap Index ETF (VEE). Evidently they feel this investable region may be ready to turn a corner after 15 years of relative underperformance. And VEE is the lowest-fee EM fund in Canada, despite having exposure to nearly 6,000 companies in the developing world.

Table of Contents: Best ETFs for Canadian Investors

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About Michael McCullough

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.

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