Best Gold ETFs in Canada 2026: CGL vs KILO vs MNT vs ZGD
Gold rallied through 2025 and into 2026 as investors hedged against persistent inflation and global uncertainty. If you want exposure inside a Canadian portfolio, ETFs are simpler than buying physical bars or coins, and a handful of well-priced funds list right on the TSX. Here is how the four biggest Canadian gold ETFs stack up on fees, structure, and tax treatment.
Why Canadian investors are buying gold ETFs in 2026
Gold spent most of 2025 making fresh nominal highs as central banks kept buying and persistent core inflation kept real yields contained. Canadian investors have noticed: trading volume on the four biggest TSX-listed gold ETFs is up sharply year over year, and search traffic for terms like gold ETF Canada hit a multi-year peak in late 2025.
An ETF wrapper solves the two biggest problems with owning gold directly. There is no storage cost, no insurance, no need to verify purity or worry about resale liquidity. You buy units the same way you buy any other TSX stock, and you can hold them inside a TFSA, RRSP, FHSA, or non-registered account.
The four biggest Canadian gold ETFs at a glance
Before we get into the trade-offs, here is the headline data on each fund. Fees are the published management expense ratio (MER) as of mid-2026, and AUM figures are rounded to the nearest hundred million CAD.
| Ticker | Issuer | Type | MER | Approx AUM | Hedged to CAD? |
|---|---|---|---|---|---|
| CGL.TO | iShares (BlackRock) | Physical bullion | 0.55% | $1.0B | Yes (CGL.C unhedged) |
| KILO.TO | Purpose Investments | Physical bullion | 0.28% | $1.1B | No (USD-priced) |
| MNT.TO | Royal Canadian Mint | Physical bullion (ETR) | 0.35% | $0.4B | No |
| ZGD.TO | BMO | Gold miner equities | 0.61% | $0.3B | No |
KILO is the cheapest of the physical funds and the only one large enough to compete with the US-listed giants on cost. MNT is structurally unique - it is technically an Exchange Traded Receipt issued directly by the Royal Canadian Mint, with the gold stored on government property. ZGD is the odd one out: it is a basket of mining companies, not metal.
Physical bullion: CGL vs KILO vs MNT
All three physical funds give you direct exposure to spot gold, but the structure differs in ways that matter at tax time and during a panic sell-off. Here is the head-to-head.
CGL (iShares)
- MER 0.55% (higher than peers)
- Hedged to CAD by default - removes USD swings
- Unhedged version is CGL.C for direct USD-gold exposure
- Biggest brand name and tightest bid-ask spread
- Best for hands-off investors who want CAD-priced gold
KILO (Purpose)
- MER 0.28% - lowest fee among Canadian gold ETFs
- Holds physical 1kg bars at the Royal Canadian Mint
- Offers in-kind redemption above $250K (rare for retail)
- USD-priced, so CAD/USD swings affect returns
- Best for cost-conscious investors who already hold USD exposure
MNT (Royal Canadian Mint)
- MER 0.35% (middle of the pack)
- Backed directly by the Government of Canada
- Allows physical gold redemption at the Mint
- Lower AUM means wider spreads in volatile sessions
- Best for investors who want sovereign-backed custody
Gold miners: when ZGD beats bullion (and when it does not)
ZGD holds an equal-weighted basket of roughly 40 global gold mining stocks - Barrick, Newmont, Agnico Eagle, and smaller names. Mining stocks have operating leverage: when gold prices rise 10%, miner profits can rise 30% or more because their cost base is largely fixed. The flip side is just as severe in a falling-gold environment.
Which gold ETF belongs in which account?
Account placement matters more than most Canadian investors realize. Physical bullion funds throw off no dividends, so the usual asset-location rules for dividend stocks do not apply. The key question is what kind of distribution the fund generates and whether USD currency conversion will trigger reportable gains.
YOUR ACCOUNT PLACEMENT PLAYBOOK
- TFSA: Best home for ZGD because miner stocks throw off small but taxable dividends. Bullion ETFs work equally well here - all capital gains are tax-free.
- RRSP: CGL or KILO work cleanly. There is no US withholding tax to worry about (these are Canadian-domiciled), so the usual RRSP advantage for US-listed funds does not apply.
- Non-registered: Use the cheapest option (KILO at 0.28%) and be ready to track adjusted cost base. Bullion redemption events can trigger taxable distributions even in years you do not sell.
- FHSA: Skip gold here. The FHSA's short time horizon and home-purchase use case is poorly suited to a volatile commodity allocation.
- RESP: A small CGL or KILO position works as portfolio insurance, but keep the allocation below 5% so contributions still grow.
How much gold belongs in a Canadian portfolio?
The classic answer from Ray Dalio's All Weather framework is 7.5% gold. Most Canadian financial planners suggest a range of 5% to 10% for investors who want a real diversifier, and 0% for investors who treat gold as a speculation rather than insurance. Above 10%, gold's lack of income production starts to materially drag long-term returns.
A practical anchor: gold rarely correlates with both stocks and bonds at the same time. In 2022, when both equity and bond ETFs in Canada posted double-digit declines, CGL ended the year roughly flat in CAD terms. That diversification value is the entire point of a small bullion allocation.
Three mistakes Canadians make with gold ETFs
- Buying the hedged version without understanding the cost. Currency hedging adds roughly 0.10% to 0.30% in annual drag and removes the CAD-weakening benefit that historically accompanies gold rallies. Unless you are explicitly trying to isolate the price of gold from FX, the unhedged version usually wins over multi-year holding periods.
- Chasing momentum after a 20% rally. Gold has a long history of consolidating for years after major moves. The investors who fared best in the 2002 to 2011 bull run bought during the long consolidation in the late 1990s, not at the peak.
- Treating ZGD as a substitute for bullion. Mining stocks are equities that happen to mine gold. They belong in your equity allocation, not your gold allocation - otherwise you are double-counting equity risk.
Frequently asked questions
What is the cheapest gold ETF in Canada?
KILO (Purpose Gold Bullion Fund) has the lowest management expense ratio at 0.28%, lower than CGL (0.55%) and MNT (0.35%). It holds physical 1kg gold bars at the Royal Canadian Mint and is priced in USD. For Canadian investors who already have some USD exposure, KILO is typically the lowest-cost way to own physical gold.
Is CGL or KILO better for a TFSA?
Both work equally well from a tax perspective inside a TFSA since all capital gains are sheltered. The choice comes down to cost and currency: KILO is cheaper (0.28% vs 0.55%) but USD-priced, while CGL is hedged to Canadian dollars by default. If you do not want the additional CAD/USD volatility on top of gold's own volatility, CGL or the unhedged CGL.C are simpler to hold long term.
Can I hold gold ETFs in my RRSP?
Yes. CGL, KILO, MNT, and ZGD are all RRSP-eligible. There is no US withholding tax to navigate because these are all Canadian-domiciled funds. The same applies to TFSA, FHSA, RESP, and non-registered accounts.
What is the difference between ZGD and CGL?
ZGD holds shares of gold mining companies (Barrick, Newmont, Agnico Eagle, and ~40 others), while CGL holds physical gold bullion in a vault. Mining stocks have operating leverage and can outperform bullion by 2x to 3x in strong gold markets, but they can also underperform sharply when energy costs rise or company-specific issues hit. For a true portfolio hedge, bullion (CGL or KILO) is the cleaner choice.
How much gold should I have in my portfolio?
Most Canadian financial planners suggest a 5% to 10% allocation if you want gold as a diversifier rather than a speculation. The classic All Weather framework uses 7.5%. Above 10%, gold's lack of income production starts to materially drag long-term returns compared to a stock-and-bond portfolio.
Are gold ETFs taxed differently than stocks in Canada?
No. Capital gains on Canadian-listed gold ETFs follow the standard 50% inclusion rate, the same as any other stock or ETF. Inside a TFSA they are completely tax-free; inside an RRSP they are tax-deferred until withdrawal. Physical bullion ETFs do not pay dividends, so there is no distribution income to report in most years.