XEQT vs HGRO: Which All-Equity ETF Is the Better Pick for Canadians?

A couple of years ago, a buddy at work cornered me in the break room. He had just discovered HGRO and was buzzing about it. “It’s like XEQT,” he said, “but it used to pay zero distributions. Zero! No tax drag at all.” He looked at me like he had just found the cheat code to investing. I told him to slow down, because the story behind HGRO is a lot more complicated than that – and a lot has changed since those “zero distribution” glory days.

That conversation stuck with me, because HGRO is genuinely one of the more interesting ETFs in Canada. It took a radically different approach to building an all-equity portfolio, and for a brief period, it really did offer a meaningful tax advantage. But the landscape has shifted. The provider rebranded. The swap structure got dismantled. And today, HGRO is a very different product than the one that originally generated all that hype.

So let’s break it down: XEQT vs HGRO – what is each ETF actually doing, where do they differ, and which one should you buy in 2026?

1. What Is XEQT?

If you have been reading this blog, you already know the answer. XEQT (iShares Core Equity ETF Portfolio) is BlackRock Canada’s flagship all-equity ETF. It launched in 2019 and has since become the default recommendation for Canadian investors who want simple, global, 100% equity exposure in a single ticker.

XEQT holds four underlying iShares index ETFs that together give you exposure to over 12,000 stocks across every major market on earth:

• US Equity: ~45%
• Canadian Equity: ~25%
• International Developed: ~25%
• Emerging Markets: ~5%

It tracks market-cap-weighted indexes, charges a 0.20% MER, and does exactly what it says on the tin. No factor tilts, no swaps, no gimmicks. You buy XEQT, you own the global stock market.

With over $7 billion in AUM, XEQT is the most popular all-equity ETF in Canada by a wide margin.

2. What Is HGRO?

HGRO (Global X All-Equity Asset Allocation ETF) is the all-equity entry in Global X Canada’s asset allocation ETF lineup. If the name “Global X” doesn’t ring a bell, you probably remember the old name: Horizons ETFs.

HGRO launched in 2020 under the Horizons brand and was designed to compete directly with products like XEQT and VEQT. Like those ETFs, HGRO aims to deliver 100% global equity exposure in a single purchase.

HGRO Geographic Allocation

• US Equity: ~45%
• Canadian Equity: ~30%
• International Developed: ~20%
• Emerging Markets: ~5%

You will notice the allocation is broadly similar to XEQT, though HGRO tilts slightly more toward Canada and slightly less toward international developed markets. Whether that matters to you depends on how bullish you are on Canadian equities relative to Europe and Japan.

HGRO’s Underlying ETFs

HGRO uses Global X’s own suite of underlying ETFs to build its portfolio. These include products like HXT (S&P/TSX 60), HXS (S&P 500), and HXDM (Developed Markets ex-North America). This is an important detail, because the underlying ETFs historically used a swap-based structure rather than physically holding stocks – more on that in a moment.

3. The Big Story: Horizons Becomes Global X

Before we compare performance and fees, we need to talk about the elephant in the room: the rebrand.

In 2023, South Korea-based Mirae Asset Global Investments completed its acquisition of Horizons ETFs, and the entire Horizons lineup was rebranded to Global X. Same ETFs, same tickers, same management team in many cases – but a different parent company and a different brand name on the door.

For HGRO holders, this raised some questions:

• Does the management change affect the fund? Not in any dramatic structural way. The portfolio managers and the underlying strategy remain largely the same.
• Is Global X trustworthy? Global X is a large global ETF provider with operations in the US, Korea, Japan, Brazil, and elsewhere. Mirae Asset manages hundreds of billions in assets worldwide. This is not some fly-by-night operation.
• Should I worry? Not really. But it is worth acknowledging that HGRO went from being managed by a well-known Canadian ETF boutique (Horizons) to being a subsidiary of a large South Korean asset manager. Some Canadian investors feel more comfortable with BlackRock, Vanguard, or BMO – names they have known for decades.

The rebrand itself is not a reason to avoid HGRO. But it is context you should have.

4. The Swap Structure: What Made HGRO Different (and What Changed)

This is the part of the HGRO story that gets people excited – and confused.

How Swaps Worked

When Horizons originally launched its index ETFs (including the ones underlying HGRO), many of them used a total return swap structure instead of physically buying stocks. Here is the simplified version:

Instead of HGRO’s underlying ETFs buying and holding thousands of individual stocks, they entered into a contract (a “swap”) with a counterparty (typically a big Canadian bank). The bank agreed to deliver the total return of the index – including dividends – in exchange for a fee. The ETF held collateral (usually government bonds) instead of stocks.

Why did this matter? Because in a swap structure, the ETF does not actually receive dividends. No dividends means no taxable distributions to unitholders. For investors holding these ETFs in taxable (non-registered) accounts, this was a legitimate tax advantage. You got the full return of the index with the taxes deferred until you sold.

Why It Changed

In 2023, the CRA and the Department of Finance essentially shut the door on this structure. New tax rules meant that swap-based ETFs tracking Canadian indexes would be treated as if they received the underlying dividends for tax purposes. Horizons (now Global X) responded by converting most of its swap-based ETFs to physical replication – meaning they now hold actual stocks, just like XEQT’s underlying ETFs do.

What This Means for HGRO Today

The tax advantage is gone. HGRO’s underlying ETFs now physically hold stocks and distribute dividends just like any other index ETF. If you were considering HGRO specifically because of the old swap-based tax benefit, that ship has sailed.

HGRO today is essentially a standard physically-replicated all-equity ETF, similar in structure to XEQT, VEQT, or ZEQT.

5. Head-to-Head Comparison: XEQT vs HGRO

Let’s put them side by side.

The headline numbers look almost identical. Same MER. Same broad strategy. Both on the TSX. Both unhedged. So what actually separates them?

6. Where XEQT Beats HGRO

Liquidity and AUM

This is the single biggest advantage XEQT has, and it is not close. With over $7 billion in AUM, XEQT is roughly 8-9x the size of HGRO. That translates to:

• Tighter bid-ask spreads: You lose less to the spread every time you buy or sell.
• Higher daily trading volume: You can move larger amounts without impacting the price.
• Lower risk of ETF closure: An ETF with $7B in assets is not going anywhere. An ETF with $800M is very likely fine too, but the margin of safety is objectively larger with XEQT.

For investors making regular contributions through dollar-cost averaging, the spread difference is small on any individual trade. But over decades of buying and eventually selling, tighter spreads add up.

Track Record

XEQT launched a full year before HGRO. That might not sound like much, but it means XEQT has a longer performance history for investors and advisors to evaluate. It also means XEQT has been through more market environments, including the COVID crash recovery in 2020.

Provider Reputation

BlackRock is the largest asset manager in the world, with over $10 trillion in global AUM. iShares is the most recognized ETF brand on the planet. When you buy XEQT, you are buying a product from a company whose entire business model depends on running index ETFs well.

Global X (Mirae Asset) is a legitimate global player, but it does not have the same brand recognition or trust with Canadian retail investors. The Horizons-to-Global X rebrand added a layer of unfamiliarity. Some investors care about this; others do not. But if “brand trust” is a factor for you, XEQT wins.

Broader Diversification

XEQT holds approximately 25% in international developed markets, compared to HGRO’s roughly 20%. XEQT also allocates less to Canada (~25% vs ~30%). This gives XEQT slightly more geographic diversification, which is generally considered a good thing from a portfolio theory perspective. Canada represents only about 3% of the global stock market, so even 25% is a significant home bias – but 30% is even more.

Underlying ETF Quality

XEQT’s underlying holdings are massive, well-established iShares ETFs that track MSCI indexes with extremely tight tracking error. The underlying funds in HGRO are Global X’s own products, which are solid but generally smaller and less liquid than the iShares equivalents.

7. Where HGRO Might Have an Edge

In the spirit of fairness, HGRO is not without its merits.

Identical MER

HGRO matches XEQT’s 0.20% MER. In the early days, HGRO’s effective costs were arguably even lower because the swap structure reduced certain operational expenses. That advantage is gone now, but 0.20% is still an excellent MER for an all-in-one ETF.

Slightly Higher Canadian Allocation

If you are bullish on Canada – perhaps you believe the energy sector, banking sector, or natural resources will outperform over the coming decade – HGRO’s ~30% Canadian allocation might appeal to you more than XEQT’s ~25%. This is a preference, not an objective advantage, but it is a difference worth noting.

Tax-Loss Harvesting Partner

Here is a practical advantage that does not get enough attention. If you own XEQT and your position is sitting at a loss, you cannot sell XEQT and immediately buy it back (that would be a superficial loss). But you can sell XEQT and buy HGRO (or vice versa), since they are not considered “substantially identical” for CRA purposes, despite being very similar products.

Having HGRO as a tax-loss harvesting partner for XEQT is genuinely useful in taxable accounts. This is the same dynamic we discussed in XEQT vs ZEQT – having multiple similar-but-not-identical ETFs gives you flexibility.

A Different Provider for Diversification

Some investors like to spread their assets across multiple providers. If your entire portfolio is in iShares products, adding HGRO gives you exposure to a different ETF issuer. This is more of a psychological comfort than a real risk reduction (your assets are held by a custodian regardless), but some people sleep better knowing they are not all-in on one brand.

8. Performance: How Do They Actually Compare?

Since HGRO launched in September 2020, both ETFs have delivered broadly similar returns. This makes sense – they are both 100% equity ETFs with similar geographic allocations tracking similar (though not identical) indexes.

The differences are small and inconsistent – some years HGRO edges ahead, other years XEQT does. Over a multi-year period, the cumulative difference is well within the range of normal tracking variation.

Bottom line on performance: It is essentially a wash. Do not choose between these two based on past returns, because the small differences are driven by allocation tilts and tracking methodology rather than any structural advantage.

9. Tax Efficiency in 2026: No Longer a Differentiator

This deserves its own section because it was historically the main reason people considered HGRO.

In the swap era (pre-2023): HGRO’s underlying ETFs did not distribute dividends, making them extremely tax-efficient in non-registered accounts. You could hold HGRO in a taxable account and defer essentially all of the tax until you sold. This was a legitimate, meaningful advantage.

After the conversion to physical replication: HGRO now distributes dividends quarterly, just like XEQT. The tax treatment is effectively identical. Both ETFs will generate:

• Canadian dividend income (eligible for the dividend tax credit)
• Foreign dividend income (taxed at your marginal rate)
• Capital gains (when you eventually sell)

If you currently hold HGRO in a taxable account specifically for the old tax benefit, you should be aware that the benefit no longer exists. That said, there is no reason to sell HGRO just because of this change – it is still a perfectly fine ETF. Selling would trigger a taxable event, which is counterproductive.

10. Which Account Should You Hold Them In?

Both XEQT and HGRO work well in any registered account:

• TFSA: Tax-free growth. No difference between XEQT and HGRO.
• RRSP: Tax-deferred growth. Both are treated identically.
• FHSA: Same as TFSA – fully sheltered.
• Non-registered (taxable): Now that HGRO uses physical replication, both ETFs have similar tax characteristics. Neither has a meaningful tax advantage over the other.

For a deeper dive on the TFSA vs RRSP question specifically, check out our guide on XEQT in TFSA vs RRSP.

11. Common Questions About XEQT vs HGRO

“Is HGRO still tax-efficient?”

No more than any other physically-replicated equity ETF. The swap-based tax advantage ended when Global X converted to physical replication. HGRO is now taxed the same way as XEQT.

“Should I switch from HGRO to XEQT?”

If you are in a registered account (TFSA, RRSP, FHSA), switching costs you nothing but the bid-ask spread. It is a reasonable move if you want the liquidity and AUM advantages of XEQT.

If you are in a taxable account, selling HGRO triggers capital gains tax. Unless your HGRO position is at a loss (in which case you could harvest the loss and buy XEQT), it is usually better to just hold HGRO and direct new contributions toward XEQT.

“Can I own both XEQT and HGRO?”

You can, but there is significant overlap. You would essentially be doubling up on global equity exposure with slightly different allocations. The only practical reason to own both is for tax-loss harvesting purposes.

“What happened to the Horizons brand?”

Horizons ETFs was acquired by Mirae Asset and rebranded to Global X in 2023. The ETFs themselves (tickers, strategies, holdings) remained the same. It was a corporate ownership change, not a product change.

“Is Global X going to shut down HGRO?”

Very unlikely. HGRO has approximately $800M in AUM, which is more than enough to be profitable for the provider. ETF closures typically happen to funds with less than $10-50M in assets. HGRO is well above that threshold.

12. My Verdict: XEQT Is the Better Pick for Most Canadians

Look, I will give HGRO credit where it is due. It was a genuinely innovative product when it launched. The swap-based structure was clever, the MER is competitive, and it has delivered returns in line with XEQT. If you already own HGRO and are happy with it, there is no urgent need to change.

But if you are choosing between these two today – putting fresh money to work in 2026 – XEQT is the better choice, and here is why:

1. Massively more liquid: $7B+ in AUM vs ~$800M. Tighter spreads, higher volume, more confidence the ETF will be around for decades.
2. BlackRock’s track record: The world’s largest asset manager, running the world’s largest ETF brand. They know how to do this.
3. Better geographic diversification: Slightly less home bias, slightly more international exposure.
4. Simpler history: XEQT has always been a straightforward, physically-replicated index ETF. No swap conversions, no rebrands, no structural changes to explain.
5. Same cost: Both charge 0.20%, so you are not paying more for XEQT’s advantages.
6. Ecosystem: If you are already reading analysis on XEQT, comparing it to alternatives like FEQT or ZEQT, there is simply more community knowledge and resources around XEQT.

The old argument for HGRO – “but the tax efficiency!” – no longer applies. Without that differentiator, HGRO is a slightly smaller, slightly less liquid version of essentially the same product. There is nothing wrong with it. But when the costs are identical, you go with the bigger, more established option.

Keep it simple. Buy XEQT.

How to Get Started with XEQT

The easiest way to start building your XEQT portfolio is through Wealthsimple, which lets you buy and sell XEQT with zero commissions.

Step 1: Open Your Account

Sign up for a Wealthsimple account. You can open a TFSA, RRSP, FHSA, or non-registered account in minutes.

Step 2: Fund Your Account

Link your bank account and transfer funds. It typically takes 1-2 business days for the money to arrive.

Step 3: Buy XEQT

Search for “XEQT,” enter the amount you want to invest, and hit Buy. Set up automatic deposits and you are on your way to building long-term wealth.

Related Reading

• What is XEQT? A Comprehensive Guide
• XEQT vs FEQT (Fidelity): Which All-Equity ETF is Right for You?
• XEQT vs ZEQT (BMO): Which All-Equity ETF Wins?
• VEQT vs XEQT: Which All-In-One ETF is Better?
• Best Platform to Buy XEQT in Canada
• Get started with Wealthsimple and earn a $25 bonus

Disclosure: This post contains referral links. I may receive compensation if you sign up through these links, but this doesn’t affect my honest assessment. I genuinely believe XEQT is the better choice for most Canadian investors.