This ETF Helps You Invest in Canada’s Best Banks

Whether you want dividends, stability, or to just bet on the economy’s long-term growth, investing in bank stocks can check off all of those items for you. And rather than investing in just one bank stock, you can invest in all of Canada’s top banks with the RBC Canadian Bank Yield Index ETF (TSX:RBNK).

This exchange-traded fund (ETF) isn’t a large one by any means as it only invests in the top six Canadian banks. Bank of Montreal (TSX:BMO)(NYSE:BMO) and Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) make up the bulk of the portfolio, accounting for around 50% of the assets. With a yield of 4.8%, you can collect a fairly high payout with this ETF, while enjoying a fair bit of stability along the way. There is a management fee of 0.29% with this fund.

This year, the ETF has risen by close to 7% and when you’re looking at the past five years, it’s up more than 75%. And that’s without even factoring in dividend payments.

Even if you’re worried about where the economy may be headed in the short term, this is an ETF that you can safely hang on to for years. While there may be some challenges ahead, in the long run, the economy is likely to expand and bank stocks should rise in value as well. And rather than picking an individual bank stock, you can easily add exposure to all the major Canadian ones through just this single ETF. This can be an ideal investment to put into your tax-free savings account and just forget about.