XLB.TO vs. ZAG.TO
XLB.TO (iShares Core Canadian Long Term Bond Index ETF) and ZAG.TO (BMO Aggregate Bond Index ETF) are both Canadian Government Bonds funds - XLB.TO tracks the Morningstar Can 10+Y Core Bd GR CAD while ZAG.TO tracks the FTSE Canada Universe Bond Index. Both are passively managed. Over the past 10 years, XLB.TO returned 4.56%/yr vs 1.66%/yr for ZAG.TO. Their correlation of 0.83 suggests significant overlap in exposure. XLB.TO charges 0.20%/yr vs 0.09%/yr for ZAG.TO.
Performance
XLB.TO vs. ZAG.TO - Performance Comparison
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Returns By Period
In the year-to-date period, XLB.TO achieves a 2.77% return, which is significantly higher than ZAG.TO's 1.70% return. Over the past 10 years, XLB.TO has outperformed ZAG.TO with an annualized return of 4.56%, while ZAG.TO has yielded a comparatively lower 1.66% annualized return.
XLB.TO
- 1D
- -0.11%
- 1M
- 3.02%
- YTD
- 2.77%
- 6M
- 0.93%
- 1Y
- 2.84%
- 3Y*
- 8.16%
- 5Y*
- 4.63%
- 10Y*
- 4.56%
ZAG.TO
- 1D
- 0.00%
- 1M
- 1.75%
- YTD
- 1.70%
- 6M
- 0.89%
- 1Y
- 3.25%
- 3Y*
- 4.24%
- 5Y*
- 0.76%
- 10Y*
- 1.66%
XLB.TO vs. ZAG.TO - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
XLB.TO iShares Core Canadian Long Term Bond Index ETF | 2.77% | -0.76% | 9.49% | 19.21% | -14.38% | 1.26% | 16.52% | 12.85% | -0.25% | 7.11% |
ZAG.TO BMO Aggregate Bond Index ETF | 1.70% | 2.25% | 4.48% | 6.41% | -11.60% | -2.60% | 8.34% | 6.84% | 1.12% | 2.45% |
Correlation
The correlation between XLB.TO and ZAG.TO is 0.91, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.91 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.92 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.92 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.88 |
Correlation (All Time) Calculated using the full available price history since Jan 26, 2010 | 0.83 |
The correlation between XLB.TO and ZAG.TO has been stable across timeframes, ranging from 0.83 to 0.92 - a consistent structural relationship.
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Return for Risk
XLB.TO vs. ZAG.TO — Risk / Return Rank
XLB.TO
ZAG.TO
XLB.TO vs. ZAG.TO - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares Core Canadian Long Term Bond Index ETF (XLB.TO) and BMO Aggregate Bond Index ETF (ZAG.TO). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.
| XLB.TO | ZAG.TO | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.37 | ||
| Sortino ratioReturn per unit of downside risk | -0.49 | ||
| Omega ratioGain probability vs. loss probability | 1.07 | 1.13 | -0.07 |
| Calmar ratioReturn relative to maximum drawdown | 0.59 | 1.17 | -0.58 |
| Martin ratioReturn relative to average drawdown | 1.11 | 2.73 | -1.62 |
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month. | |||
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Sharpe Ratios by Period
| XLB.TO | ZAG.TO | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 0.36 | 0.73 | -0.37 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | 0.37 | 0.12 | +0.25 |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | 0.39 | 0.23 | +0.15 |
Sharpe Ratio (All Time)Calculated using the full available price history | 0.55 | 0.45 | +0.10 |
Drawdowns
XLB.TO vs. ZAG.TO - Drawdown Comparison
The maximum XLB.TO drawdown since its inception was -24.34%, which is greater than ZAG.TO's maximum drawdown of -18.03%. Use the drawdown chart below to compare losses from any high point for XLB.TO and ZAG.TO.
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Drawdown Indicators
| XLB.TO | ZAG.TO | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -24.34% | -18.03% | -6.31% |
Max Drawdown (1Y)Largest decline over 1 year | -4.85% | -2.79% | -2.06% |
Max Drawdown (3Y)Largest decline over 3 years | -9.74% | -5.42% | -4.32% |
Max Drawdown (5Y)Largest decline over 5 years | -24.34% | -15.77% | -8.57% |
Max Drawdown (10Y)Largest decline over 10 years | -24.34% | -18.03% | -6.31% |
Current DrawdownCurrent decline from peak | -2.17% | -1.09% | -1.08% |
Average DrawdownAverage peak-to-trough decline | -4.05% | -3.54% | -0.51% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 2.57% | 1.19% | +1.38% |
Volatility
XLB.TO vs. ZAG.TO - Volatility Comparison
iShares Core Canadian Long Term Bond Index ETF (XLB.TO) has a higher volatility of 2.77% compared to BMO Aggregate Bond Index ETF (ZAG.TO) at 1.68%. This indicates that XLB.TO's price experiences larger fluctuations and is considered to be riskier than ZAG.TO based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| XLB.TO | ZAG.TO | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 2.77% | 1.68% | +1.09% |
Volatility (6M)Calculated over the trailing 6-month period | 5.77% | 3.43% | +2.34% |
Volatility (1Y)Calculated over the trailing 1-year period | 7.93% | 4.46% | +3.47% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 12.68% | 6.58% | +6.10% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 11.86% | 7.11% | +4.75% |
XLB.TO vs. ZAG.TO - Expense Ratio Comparison
XLB.TO has a 0.20% expense ratio, which is higher than ZAG.TO's 0.09% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.
Dividends
XLB.TO vs. ZAG.TO - Dividend Comparison
XLB.TO's dividend yield for the trailing twelve months is around 4.01%, more than ZAG.TO's 3.42% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
XLB.TO iShares Core Canadian Long Term Bond Index ETF | 4.01% | 4.05% | 12.10% | 12.22% | 13.13% | 8.82% | 7.43% | 3.18% | 3.56% | 3.45% | 3.62% | 3.64% |
ZAG.TO BMO Aggregate Bond Index ETF | 3.42% | 3.48% | 3.44% | 3.47% | 3.56% | 3.04% | 2.88% | 3.03% | 2.92% | 2.95% | 3.07% | 3.13% |
Frequently Asked Questions
With a correlation of 0.91, XLB.TO and ZAG.TO move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.
On fees, ZAG.TO is cheaper at 0.09% per year. The better choice depends on whether you care most about return, fees, risk, or income.
ZAG.TO is cheaper with a 0.09% expense ratio, compared with 0.20% for XLB.TO.
XLB.TO tracks Morningstar Can 10+Y Core Bd GR CAD, while ZAG.TO tracks FTSE Canada Universe Bond Index. They also come from different issuers: iShares and BMO. Their fees differ too: 0.20% for XLB.TO and 0.09% for ZAG.TO.
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