Canada’s Top Technology ETFs to Buy in March 2025

ByDylan Callaghan Published On:

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        Key takeaways

        Market Volatility – While tech stocks have strong long-term potential, they can be sensitive to interest rate changes and economic downturns.

        Tech Growth Potential – Technology ETFs provide access to high-growth sectors, benefiting from innovation in AI, cloud computing, and semiconductors.

        Different Approaches – Some ETFs focus on Canadian tech, while others provide global exposure to industry leaders.

        One ETF I like way better than the ones on this list.

        Technology has been one of the best-performing sectors on the market since the financial crisis. As smartphones continue to develop, artificial intelligence gains steam and numerous innovations are made to make human life easier; technology companies are often able to push out exceptionally high-margin products and services, which ultimately makes them very attractive investments.

        As a result, Canadians want exposure to this sector. There is a high likelihood that if you did not have adequate exposure to technology options over the last 15 years or so, your returns lagged the markets by a wide margin.

        However, buying individual stocks is extremely hard. As such, many Canadians are looking for Canadian tech ETFs to get exposure not only here in Canada but also south of the border.

        In this article, I will review some Canadian ETFs that can get you single-click exposure to all of the popular technology options in North America. There aren’t many, but the ones that do exist are high-quality and very popular.

        The top Canadian tech ETFs to buy right now

        Canada’s premier tech sector ETF

        iShares S&P/TSX Capped Information Tech Index ETF (TSE:XIT)

        XIT is the go-to ETF for investors seeking exposure to Canada’s technology sector. It tracks the S&P/TSX Capped Information Technology Index, offering concentrated exposure to major Canadian tech firms, including Shopify and Constellation Software.

        • Pure Canadian Tech Exposure – XIT provides direct access to Canada’s top tech companies, making it ideal for investors who believe in the country’s innovation sector.
        • Highly Concentrated Holdings – The ETF has a small number of holdings, with Shopify and Constellation Software making up a significant portion. This can amplify returns but also increase risk.
        • Growth Potential in Canadian Tech – Canada has a growing tech scene, particularly in e-commerce, AI, and software development. XIT benefits from this trend.
        • Strong Historical Returns – Over the long term, XIT has delivered strong returns, especially during bull markets in tech.
        • Lack of Diversification – Unlike global tech ETFs, XIT is focused solely on Canadian companies, missing out on major U.S. tech giants.
        • Canadian Tech Expansion – Companies like Shopify continue to expand globally, positioning Canada as a growing tech hub.
        • Interest Rate Sensitivity – Higher rates can pressure tech valuations, affecting XIT’s performance.
        • Government Tech Incentives – Canada offers R&D incentives and grants for tech firms, which can support growth.
        • Heavy Shopify Dependence – If Shopify underperforms, XIT will be significantly affected.
        • Limited Sector Diversity – The ETF lacks exposure to semiconductor and hardware companies.
        • Volatility – Small tech companies can be highly volatile, making this ETF riskier than a diversified global tech fund.

        Broad global tech exposure

        TD Global Technology Leaders Index ETF (TSE:TEC)

        TEC provides investors with access to the world’s leading technology companies by tracking the Solactive Global Technology Leaders Index. It includes U.S. giants like Apple, Microsoft, and NVIDIA, alongside other global tech innovators.

        • Global Tech Leaders – TEC holds top tech firms worldwide, offering exposure to industry giants.
        • Diversified Across Sub-Sectors – The ETF includes software, semiconductors, cloud computing, and fintech, reducing concentration risk.
        • AI and Cloud Computing Growth – Companies in TEC are at the forefront of AI, big data, and cloud services, all key future growth areas.
        • Less Concentration Risk than XIT – Unlike XIT, TEC is well-diversified across multiple global tech companies.
        • Long-Term Performance – Historically, global tech stocks have outperformed the broader market, making TEC a strong long-term investment.
        • AI Boom – Companies like NVIDIA and Microsoft are leading AI innovation, benefiting TEC’s holdings.
        • Semiconductor Industry Growth – Chipmakers like TSMC and Intel are key components of TEC and are essential for global tech development.
        • Cloud Dominance – The rise of cloud computing continues to drive revenue for companies like Amazon and Google.
        • Market Sensitivity to Interest Rates – Higher rates can impact valuations, as tech stocks rely on future growth.
        • Global Economic Slowdown – A recession or weak consumer spending could hurt tech company earnings.
        • Currency Risk – Since TEC holds U.S. and international stocks, exchange rate fluctuations can affect returns.

        Exposure to top U.S. tech firms

        BMO NASDAQ 100 Equity Index ETF (TSE:ZNQ)

        ZNQ tracks the NASDAQ-100 Index, giving investors access to the largest non-financial companies listed on the NASDAQ, with heavy exposure to tech leaders like Apple, Amazon, and Tesla.

        • Top U.S. Tech Exposure – ZNQ provides access to leading American tech firms, many of which dominate global innovation.
        • Strong Performance History – The NASDAQ-100 has historically outperformed broader indices, making ZNQ a high-growth investment.
        • Mega-Cap Tech Dominance – Companies like Apple, Microsoft, and Google have strong business models, high cash reserves, and long-term growth potential.
        • Secular Tech Trends – The ETF benefits from trends like AI, cloud computing, and e-commerce, all major drivers of future growth.
        • Less Volatile than XIT – While still tech-heavy, ZNQ is slightly more diversified than XIT due to its broader industry representation.
        • Tech Earnings Growth – Large-cap tech companies continue to report strong revenues and profitability, supporting ZNQ’s long-term growth.
        • AI and Automation Investments – Companies in the NASDAQ-100 are leading the charge in automation, benefiting from global digital transformation.
        • Interest Rate Decisions – Like other tech ETFs, ZNQ is sensitive to Federal Reserve policy and inflation data.
        • Tech Sector Sell-Offs – If market sentiment shifts, high-growth tech stocks can experience sharp declines.
        • Regulatory Scrutiny – Big tech companies face increased government regulation, which could impact profits and valuations.
        • Overconcentration in a Few Stocks – The top five holdings make up a large portion of the index, meaning underperformance from one or two companies could hurt returns.

        Overall, these Canadian tech ETFs provide solid exposure to a variety of markets

        If you’re looking for exclusive Canadian tech exposure, then XIT is going to be the best Canadian tech ETF around. The one important thing to note with this fund, however, is that it is heavily concentrated in Canada’s two big players, Shopify and Constellation.

        Globally, TEC provides some very unique exposure and also does so with some pretty low management fees.

        And finally, if you’re looking for exclusive exposure for tech south of the border and to the NASDAQ 100, the unhedged version of BMO’s product should serve you fine. However, if you feel you still want to be hedged to the Canadian dollar, look at ZQQ.

        On a side note, if you’re looking for tech exposure in international markets, have a look at our top emerging market ETFs in Canada.

        These Canadian tech ETFs all sport higher yet completely reasonable fees due to the fact they are “niche” ETFs and not broad index funds. They require a little more active management, and as such, you’ll pay for this.

        But in all situations, the fees are essentially non-factors because of the returns.

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