xaw etf

ETF review: XAW iShares Core MSCI All Country World ex Canada

What is XAW ETF?

XAW is an index ETF. It’s an easy and effective way to get exposure to international markets. The fund invests in a basket of index funds that allow to benefit from growth opportunities outside of the Canadian market.

This fund is ideal as an addition to an existing portfolio that invests mainly in Canadian stocks. Buying XAW will help you invest in a global portfolio and thus achieve diversification.

XAW is ideal for long term investors.

Does XAW rebalance?

Yes, XAW rebalances itself. The manager makes sure the weighting for each market is stable.

XAW vs XEQT iShares all equity ETF

XEQT is an all in one ETF. By owning XEQT you a fully diversified portfolio that invests in Canadian and international markets at the same time. XAW as discussed invests solely in international markets excluding Canada. To build a fully diversified portfolio, one can hold a Canadian index ETF such as XIC and XAW.

XEQT holdings

NameSymbol% Assets
iShares Core S&P Total US Stock Mkt ETFITOT47.54%
iShares Core S&P/TSX Capped Compost ETFXIC.TO24.56%
iShares Core MSCI EAFE IMI ETFXEF.TO22.71%
iShares Core MSCI Emerging Markets ETFIEMG

Tax implications of owning ETFs that invest in US and International stocks

There are tax implications when holding an ETF that invests in US and international stocks. Any dividend received will be reduced by withholding taxes depending on the scenarios below. The table below provides a summary:

Canadian ETF: 1$ dividend
scenario
TaxesDividend
received
1- Holding US or
International stocks directly
-0.15$ (withholding tax from US or
foreign jurisdiction) Creditable
0.85$
2- Holding US listed
ETFs that invest in US stocks
-0.15$ (withholding tax from US or
foreign jurisdiction) Creditable
0.85$
3- Holding US listed ETFs
that invest in International stocks
-0.15$ (withholding tax from foreign
jurisdiction) Non creditable -0.13
(withholding tax from US) Creditable
0.72$

The chart is designed for illustrative purposes only and is subject to change. Please consult a tax specialist for more information.

XAW ETF historical performance and dividend yield

Dividend yield: 2.21% as of August 29th 2022

Monthly
total
returns
Year to date-9.79
1-Month8.52
3-Month3.13
1-Year-5.88
3-Year9.70
5-Year9.52
Source: Yahoo finance

XAW ETF holdings

TickerNameWeight
IVVISHARES CORE S&P 500 ETF53.72
XEFISHARES MSCI EAFE IMI INDEX25.49
IEMGISHARES CORE MSCI EMERGING MARKETS11.49
IJHISHARES CORE S&P MID-CAP ETF3.86
ITOTISHARES CORE S&P TOTAL U.S. STOCK2.95
IJRISHARES CORE S&P SMALL-CAP ETF2.39
USDUSD CASH0.08
CADCAD CASH0.02