VDY vs XEI

Updated October 10, 2026 · StockSignalCheck

VDY and XEI are two of the most popular Canadian dividend ETFs. Both hold Canadian companies that pay above-average dividends and both pay out monthly. The big difference is concentration: VDY is heavily weighted to banks, while XEI spreads across more companies and sectors.

Figures were checked in October 2026 and change over time, so treat them as approximate and check the provider's own page before investing. This page compares features; it isn't a recommendation to buy any fund or use any broker.

Side by side

	VDY	XEI
Provider	Vanguard	BlackRock (iShares)
Index	FTSE Canada High Dividend Yield	S&P/TSX Composite High Dividend
Management fee	0.20%	0.20%
Total MER	About 0.22%	About 0.22%
Fund size	About $9 billion	About $4.3 billion
Holdings	About 60	About 75
Financials	About 60%	About 36%
Energy	About 29%	About 31%
Utilities and telecom	Small	About 16%
Yield (12-month)	About 3.1%	About 3.5%
Distributions	Monthly	Monthly

Source: fund data compiled by Cboe Canada (etfmarket.cboe.com), early October 2026. "Fee" is the management fee; the total MER is usually about 0.01–0.02 points higher. Yield is the trailing 12-month distribution yield and changes with prices and payouts.

What actually differs

1. Concentration. VDY puts roughly 60% in financial companies, mostly the big banks and insurers, and most of the rest in energy. That's close to a two-sector fund. XEI caps how much any one company can be, so it holds more utilities, telecoms and pipelines and is less dependent on the banks.

2. Yield. XEI has recently paid a little more. A higher yield isn't automatically better: it can come from owning companies whose share prices have fallen. See dividends explained.

3. Performance pattern. When Canadian banks do well, VDY tends to lead; when banks lag and utilities or telecoms hold up, XEI tends to. Over long periods the gap has gone both ways.

Things to know about dividend ETFs

Less diversified than the whole market. Both leave out most technology, health care and industrial companies. A broad index ETF like XIC holds about 220 companies.
Dividends aren't free money. When a fund pays a distribution, its price drops by about the same amount. Total return (price change plus dividends) is what counts.
Tax. Canadian dividends get the dividend tax credit in a non-registered account. In a TFSA or RRSP they're sheltered either way.

Choosing between them

If you want the most income and are comfortable being concentrated in banks, VDY fits that. If you want dividend income with a bit more spread across sectors, XEI does that. Many investors hold a dividend ETF alongside a broad market fund rather than on its own.

Several of the companies both funds hold have their own pages on StockSignalCheck, including Royal Bank, TD, Enbridge and BCE.

Official fund pages

Keep learning

Dividends explainedHow dividends are paid, what yield and payout ratio mean, and the dates that matter.XIC vs XIU vs ZCNThe whole TSX or just the biggest 60, and why the fee gap matters.Broker fees compared: Wealthsimple, Questrade, IBKR, moomooCommissions, currency fees and USD accounts at four popular Canadian brokers.What is a moving average?How 5-day and 20-day averages smooth out price noise, and what they can't tell you.

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This guide is for education only. It isn't personalized financial, investment or tax advice, and nothing here is a recommendation to buy or sell any security. Investing involves risk, including the possible loss of your money.