There is no stock market return without risk, but risk can be taken intelligently. It has historically been a reliable approach to staying broadly diversified, keeping costs low and owning profitable blue chip companies. Using that framework, here’s a simple strategy built around a single BMO exchange-traded fund (ETF) that has historically turned a $20,000 investment into about $75,000 after taxes.
What we invest in
The benchmark here is the S&P 500. It is a US index of 500 large-cap companies, selected through a defined methodology and overseen by a committee. To qualify, companies must meet minimum size and liquidity thresholds and demonstrate a history of positive profits.
The result is a broad swath of the U.S. economy. Technology, healthcare and financials dominate, but the index also includes exposure to consumer staples, consumer discretionary, utilities, energy, real estate and the rest of the eleven sectors. You are not betting on one industry or one company. You’re buying the productive core of corporate America.
Index ETFs make this approach accessible. These funds simply buy all the companies in the index. When you buy one unit, you get fractional exposure to each share in it. Because there is no stock selection, costs remain low.
The ETF to choose from
My preferred option is here BMO S&P 500 Index ETF (TSX:ZSP). It offers full exposure to the S&P 500 at a very low expense ratio of 0.09%.
Based on historical data, from January 2016 to December 2025, a $20,000 investment in ZSP, with all dividends reinvested, was compounded at an annualized rate of 14.37%. That would have grown to about $76,567 by the end of the period.
That outcome presupposes three things. First, you never have to panic when the market drops. Second, each dividend was reinvested as soon as it was paid out. Third, there was no tax. That last point is crucial. For this strategy to work as intended, ZSP must be held in a registered account, such as a tax-free savings account.
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