The Canadian energy sector remains an incredibly attractive place for investors looking to capitalize on strong macroeconomic trends. With inflation remaining stubbornly high and global oil prices staying elevated, domestic oil and gas producers are generating massive amounts of cash flow. For those seeking broad exposure to this lucrative space without betting on a single company, the BMO Equal Weight Oil & Gas Index ETF (TSX:ZEO) stands out as an exceptional option.
This exchange-traded fund provides investors with a balanced, diversified portfolio of the top energy companies in the country. By utilizing an equal-weight strategy, the fund ensures that you are not overly exposed to just one or two massive producers, effectively spreading your capital across a robust basket of industry leaders.
The performance of this fund in 2026 has been nothing short of phenomenal. The ETF is already up over 40% this year, easily outpacing the broader markets. Despite this massive run-up, there is still plenty of room for it to rise higher. As long as energy demand remains steady and oil prices stay strong, the underlying companies in this fund will continue to thrive and return value to shareholders.
In addition to its impressive capital appreciation, the fund also rewards investors with a steady stream of dividend income, yielding around 2.9%. For income-focused investors, this provides a reliable payout while you hold onto an asset that is perfectly positioned for the current economic climate.
By adding this top energy ETF to your portfolio, you can benefit from both rising oil prices and strong dividends.
