Bond ETF Portfolio

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Hi Dan:
Any suggestion for a couple bond ETFS . From previous questions it appears you are strong on a combo of ZAG with some weighting to ZLC and ZCM. Any particular percentages or any other bond ETF’s you would consider throwing in the mix.

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Asked on August 13, 2025 11:36 am
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Private answer

BMO has a great suite of bond ETFs. So much so that you can either just buy an entire fund like ZAG or even isolate out particular segments you'd like to target.

It is difficult for me to provide suggestions as to what bond ETFs would be good because it is solely dependent on the individual. For example, someone might be interested in taking a bit more risk on the longer end of things to get some capital appreciation and buy long-term treasuries or long-term corporate bonds because if rates decline, prices should go up.

On the flip side, someone looking for steady income and capital preservation might find more value in the short-term end of thing as they're less likely to fluctuate in price and aren't as volatile based on inflation data/rates etc.

It's not like individual stocks where we have an underlying business and if that business appeals to an investor they just buy it. Bond portfolios are heavily tailored to what the individual wants to achieve.

Safety? Short-term government treasuries. Safety with a bit of yield? Can look to the longer end of things but have to be willing to accept the volatility and movements in price based on inflation/rates.

If you're willing to take on more risk to earn more yield, corporate bonds do offer a bit more, but will fluctuate in price more than government t-bills.

For simplicities sake, if you don't have an idea of what structure you want (say corporate bonds, 60% short term, 20% mid term, 20% long term) it is probably better to just look at an entire bond fund like ZAG, ZCB etc.

Whereas if you do have an idea of the structure you want, you can head to a page like this

https://bmogam.com/ca-en/products/exchange-traded-funds/fixed-income/

And click the "targeted exposure" tab and it will give you all of BMO's target bond funds. One could have a diverse portfolio of corporation or government bonds in just 3 clicks. Just have to figure out the exposure you want.

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Posted by Dan Kent
Answered on August 14, 2025 9:34 am
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Excellent, thanks Dan.
(bpl521@outlook.com at August 14, 2025 9:58 am)