If you want the broader ETF framework before adding a commodity sleeve, start with our ETFs and index funds hub.
Best Commodity ETFs Listed on the TSX
Broad Commodity
| ETF | Ticker | MER | Yield | Holdings | Commodity Exposure | Distribution |
|---|
| iShares Bloomberg Commodity | COW | 0.27% | 0% | Futures basket | Energy, metals, agriculture | None |
| Horizons Enhanced Multi-Asset | HEA | 0.35% | 0% | Futures + equities | Diversified commodities | None |
| ETF | Ticker | MER | Type | What It Holds |
|---|
| iShares S&P/TSX Global Gold | XGD | 0.61% | Equity | Gold mining stocks |
| BMO Equal Weight Gold | ZGD | 0.61% | Equity | Equal-weight gold miners |
| iShares Gold Bullion (CAD-Hedged) | CGL | 0.55% | Physical | Gold bullion in vault |
| iShares Gold Bullion (Unhedged) | CGL.C | 0.55% | Physical | Gold bullion (CAD unhedged) |
| Sprott Physical Gold Trust | PHYS | 0.40% | Physical | Allocated gold bullion |
| BMO Gold Bullion | ZGLD | 0.20% | Physical | Gold bullion |
| iShares Silver Bullion | SVR | 0.53% | Physical | Silver bullion |
| Sprott Physical Silver Trust | PSLV | 0.62% | Physical | Allocated silver |
Agriculture
| ETF | Ticker | MER | Type | Commodities |
|---|
| iShares Global Agriculture | COW | 0.68% | Equity | Agriculture companies |
| Horizons Agriculture | N/A | Varies | Futures | Wheat, corn, soybeans |
Energy Commodities
| ETF | Ticker | MER | Type | Commodity |
|---|
| Horizons Crude Oil | HUC | 1.09% | Futures | WTI crude oil |
| Horizons Natural Gas | HUN | 1.09% | Futures | Henry Hub natural gas |
| United States Oil Fund | USO (US) | 0.60% | Futures | WTI crude oil |
US-Listed Broad Commodity ETFs (Accessible from Canada)
| ETF | Ticker | MER | Commodities Covered | AUM |
|---|
| Invesco DB Commodity Index | DBC | 0.85% | Energy, metals, agriculture | $2B+ |
| iShares S&P GSCI Commodity | GSG | 0.75% | Broad basket, energy-heavy | $1B+ |
| Invesco Optimum Yield Diversified | PDBC | 0.59% | Broad basket, K-1 free | $5B+ |
| abrdn Physical Precious Metals Basket | GLTR | 0.60% | Gold, silver, platinum, palladium | $1B+ |
| SPDR Gold Trust | GLD | 0.40% | Physical gold bullion | $60B+ |
| iShares Silver Trust | SLV | 0.50% | Physical silver bullion | $10B+ |
Commodity Types and ETF Options
| Commodity Type | Examples | Best ETF Access | Correlation to Inflation |
|---|
| Gold | Bullion, miners | CGL, PHYS, XGD | Moderate-high |
| Silver | Bullion | SVR, PSLV, SLV | Moderate |
| Oil | WTI, Brent | HUC, XEG, USO | High |
| Natural gas | Henry Hub | HUN, natural gas equities | Moderate |
| Agriculture | Wheat, corn, soybeans | COW, DBA, agricultural equities | High |
| Copper | Industrial metal | Copper mining ETFs, COPX | Moderate |
| Broad basket | All of the above | DBC, PDBC, GSG | High |
Physical vs Futures-Based Commodity ETFs
Gold is the clearest example of the physical approach in practice, so compare best gold ETFs in Canada.
| Factor | Physical ETF | Futures-Based ETF |
|---|
| How it works | Holds real commodity in vault | Holds futures contracts, rolls monthly |
| Available for | Gold, silver, platinum, palladium | Oil, gas, agriculture, metals, broad baskets |
| Tracking accuracy | Very high — tracks spot price closely | Can diverge due to contango/backwardation |
| Roll cost / contango drag | None | 2–5% annual drag in contango markets |
| Storage cost | Included in MER (vault fees) | N/A |
| Tax treatment | Capital gains on sale | Capital gains (may vary by structure) |
| Best for | Gold/silver buy-and-hold | Broad commodity baskets, short-term |
| Examples | CGL, PHYS, GLD, SLV | DBC, GSG, HUC |
Commodities as an Inflation Hedge
| Period | CPI Inflation | Gold Return | Oil Return | S&P 500 Return |
|---|
| 1973–1974 | 12% | +67% | +200%+ | -40% |
| 1979–1980 | 13% | +120% | +100%+ | +18% |
| 2021–2022 | 6–8% | +1% | +65% | -18% |
| 2022–2023 | 4–6% | +13% | -5% | +16% |
Past performance does not guarantee future results.
Portfolio Allocation
Recommended Commodity Allocation
| Investor Profile | Commodity Allocation | How to Implement |
|---|
| Conservative | 0–5% | Gold bullion ETF (CGL, PHYS) |
| Balanced | 5–10% | Gold + broad commodity (CGL + DBC) |
| Inflation-worried | 10–15% | Gold + commodities + TIPS |
| Aggressive/tactical | 15–20% max | Broad basket + sector bets |
This is a satellite sleeve decision, so it should follow your core allocation work in asset allocation by age.
Sample Portfolio with Commodity Sleeve
| Holding | Allocation | Role |
|---|
| XEQT (All-equity) | 60% | Core global equity |
| ZAG (Bonds) | 15% | Stability |
| CGL (Gold bullion) | 5% | Inflation hedge, crisis insurance |
| DBC (Broad commodities) | 5% | Inflation hedge, diversification |
| XEG (Energy equities) | 10% | Canadian energy income |
| REITs | 5% | Real assets |
Risks of Commodity ETFs
| Risk | Detail |
|---|
| No income | Most commodity ETFs pay no dividends (they hold commodities, not businesses) |
| Contango drag | Futures-based ETFs can lose 2–5% annually to roll costs |
| High volatility | Oil can swing 30–50% in a year; gold is less volatile but still cyclical |
| USD exposure | Many commodities are priced in USD — currency affects CAD returns |
| Zero long-term real return | Commodities don’t generate earnings — long-term returns are near inflation |
| Complexity | Futures contracts, roll yields, and tax treatment can be confusing |
| Supply/demand shocks | Weather, geopolitics, OPEC decisions create unpredictable swings |
If your main concern is inflation protection rather than raw commodity beta, compare best bond ETFs in Canada and best infrastructure ETFs in Canada.
Tax Considerations
| Commodity ETF Type | TFSA/RRSP Treatment | Non-Registered Treatment |
|---|
| Gold bullion (CGL, PHYS) | Capital gains tax-sheltered | Capital gains on sale (50% inclusion) |
| Gold miners (XGD) | Dividends + capital gains sheltered | Eligible dividends (Canadian) + capital gains |
| Futures-based (DBC) | Capital gains sheltered | Complex — may include ROC |
| US-listed (GLD, SLV) | Subject to US estate tax risk >$60K | Foreign reporting requirements |