Halal ETFs Canada 2026: Complete List of Sharia-Compliant ETFs

The Growing Demand for Halal ETFs in Canada

Canadian Muslim investors have more options for Shariah-compliant investing in 2026 than at any point in history. Even five years ago, building a halal portfolio in Canada meant either picking individual stocks (and screening each one yourself) or paying high fees for niche mutual funds. Today, low-cost halal ETFs trade on the TSX, major robo-advisors offer dedicated halal portfolios, and the ecosystem continues to grow.

This guide covers every halal ETF available to Canadian investors in 2026 - both Canadian-listed and US-listed - along with halal robo-advisor options, how to hold them in your registered accounts, and how they compare on cost and performance. Whether you are a seasoned investor or just starting to align your portfolio with your values, this is the reference you need.

A note on approach: Muslims hold different views on the specifics of halal investing, and scholars sometimes disagree on screening thresholds or whether certain financial instruments are permissible. This guide presents the most widely accepted standards used by major Shariah advisory boards. We encourage you to consult a qualified Islamic scholar for questions specific to your situation.

What Makes an ETF Halal?

An ETF is considered halal when it only holds investments that comply with Islamic financial principles. This means the fund must exclude companies involved in prohibited activities and must avoid structures that generate or rely on interest (riba). A halal ETF achieves this through a systematic screening process overseen by an independent Sharia advisory board.

The key difference between a halal ETF and a conventional ETF is the screening layer. A conventional S&P 500 ETF holds all 500 companies in the index regardless of what they do. A Shariah-screened version of the same index starts with those 500 companies, removes the ones that fail compliance screens, and invests only in the remaining companies. The result is a diversified equity portfolio that excludes haram business activities and financially over-leveraged companies.

The financial ratio screens deserve special attention. The 33% debt-to-assets threshold means that heavily leveraged companies are excluded - which includes most banks, insurance companies, and real estate investment trusts (REITs). This has the practical effect of giving halal portfolios a structural underweight in the financials sector and an overweight in technology, healthcare, and consumer goods. Interestingly, this low-leverage tilt has been a performance advantage in some market environments, particularly during financial crises when highly leveraged companies suffer the most.

Canadian-Listed Halal ETFs

As of 2026, there is one primary halal ETF listed on a Canadian exchange. While the selection is limited compared to conventional ETFs, it provides broad global equity exposure and eliminates the need for currency conversion.

WSHR - Wealthsimple Shariah World Equity Index ETF

WSHR is the flagship halal ETF for Canadian investors. Listed on the TSX and denominated in Canadian dollars, it tracks a Shariah-screened global equity index covering developed and emerging markets. The fund is managed by Wealthsimple and screened by a recognized Sharia advisory board that reviews holdings quarterly.

• Exchange: TSX (Toronto Stock Exchange)
• Currency: CAD
• MER: 0.50%
• Holdings: Approximately 350-500 Shariah-compliant global equities
• Geographic exposure: US (~60%), international developed (~25%), emerging markets (~15%)
• Top sectors: Technology, healthcare, consumer discretionary, industrials
• Sharia oversight: Independent Sharia advisory board with quarterly screening
• Where to buy: Any Canadian brokerage - Wealthsimple Trade, Questrade, TD Direct Investing, RBC Direct Investing, NBDB, etc.

The primary advantage of WSHR for Canadian investors is simplicity: you buy it in Canadian dollars on the TSX with no currency conversion fees, it provides global diversification in a single ticker, and Sharia compliance is maintained automatically. For most Canadian Muslim investors, WSHR as a core holding - or even as the entire equity allocation - is a reasonable and practical approach.

US-Listed Halal ETFs Available to Canadians

Canadian investors can purchase US-listed ETFs through most Canadian brokerages. These funds trade in US dollars, so you will incur currency conversion costs when buying and selling. However, they offer additional options for investors who want more targeted exposure or prefer a specific screening methodology.

SPUS - SP Funds S&P 500 Sharia Industry Exclusions ETF

SPUS tracks a Shariah-compliant version of the S&P 500, making it one of the most popular halal ETFs in North America. It starts with the S&P 500 and removes companies that fail Sharia screens, resulting in a concentrated portfolio of large-cap US equities.

• Exchange: NYSE Arca (US)
• Currency: USD
• MER: 0.49%
• Holdings: Approximately 230-280 S&P 500 constituents that pass Sharia screens
• Geographic exposure: 100% US large-cap
• Screening: S&P Shariah methodology based on AAOIFI standards
• Where to buy: Questrade, Wealthsimple Trade, Interactive Brokers, TD Direct Investing, and other Canadian brokerages offering US market access

HLAL - Wahed FTSE USA Shariah ETF

HLAL tracks the FTSE USA Shariah Index, providing exposure to US equities screened according to FTSE Russell's Shariah methodology. It is managed by Wahed Invest, one of the largest Islamic fintech companies globally.

• Exchange: NASDAQ (US)
• Currency: USD
• MER: 0.50%
• Holdings: Approximately 200-300 US equities screened by FTSE Russell Shariah methodology
• Geographic exposure: 100% US
• Screening: FTSE Russell Shariah Advisory Board
• Where to buy: Same Canadian brokerages with US market access

Halal ETF Comparison Table: 5 ETFs Across 6 Sharia-Compliance Criteria

Here is a side-by-side comparison of the five most relevant halal ETFs available to Canadian investors in 2026, evaluated across six Sharia-compliance criteria: ticker, MER, Sharia screening method, holdings count, dividend purification percentage, and country exposure. WSHR is the only Canadian-listed option; the others are US-listed and accessible through any Canadian brokerage with US market access.

A few notes on this table. SPSK is a Sukuk (Islamic fixed-income) ETF - Sukuk are asset-backed certificates that generate halal income through profit-sharing rather than interest, so they have no purification requirement. SPRE provides exposure to a small subset of REITs that pass Sharia screens (most conventional REITs fail the 33% debt-to-assets test, but a handful with conservative balance sheets are eligible). WSHR, SPUS, and HLAL are all equity-focused; SPSK and SPRE round out a diversified halal portfolio with fixed-income and real estate components.

For comparison, popular conventional all-equity ETFs like XEQT (iShares Core Equity ETF Portfolio) charge an MER of 0.20%, and the Vanguard S&P 500 ETF (VFV) charges 0.09%. The halal premium is roughly 0.30-0.40% per year - a meaningful but not prohibitive difference, especially considering that actively managed halal mutual funds often charge 1.5-2.5%.

Three Halal Portfolio Worked Examples: $10K, $50K, $100K

Below are three concrete halal portfolios sized for different investor stages. Each uses real tickers from the comparison table above and shows dollar allocations, weighted MER, and a 5-year return projection. Projections assume an 8% annualized total return for global halal equity (broadly in line with historical MSCI World Islamic Index performance), 4% for Sukuk, and 6% for halal REITs - these are illustrative only, not guarantees.

Halal Robo-Advisor Options in Canada

Not every investor wants to select and manage their own ETFs. For those who prefer a fully managed approach, two Canadian platforms offer dedicated Shariah-compliant portfolios.

Wealthsimple Halal Investing

Wealthsimple offers a Halal Investing portfolio option within its managed investing platform. When you select the halal option, your portfolio is invested primarily in WSHR (their own Shariah-compliant ETF) with allocations adjusted based on your risk profile. The platform handles automatic rebalancing, dividend reinvestment, and tax-loss harvesting where applicable.

• Management fee: 0.40-0.50% (depending on account tier) on top of ETF MERs
• Total cost: Approximately 0.90-1.00% all-in
• Account types: TFSA, RRSP, RESP, FHSA, non-registered
• Minimum investment: No minimum
• Best for: Investors who want hands-off management and use other Wealthsimple products

Manzil

Manzil is a Canadian Islamic fintech company that offers Shariah-compliant investment portfolios alongside halal mortgage alternatives. Their investment platform provides managed portfolios that are screened and supervised by their Sharia advisory board. Manzil positions itself as a comprehensive Islamic financial services provider for Canadian Muslims.

• Management fee: Varies by portfolio size and type
• Sharia oversight: Dedicated Sharia advisory board
• Account types: TFSA, RRSP, RESP, FHSA, non-registered
• Additional services: Halal home financing (Musharaka-based), financial planning
• Best for: Muslims who want a fully Islamic financial services provider and value having a Sharia board directly overseeing their investments

The choice between self-directed ETF investing and a managed platform comes down to your comfort level and how much you value convenience. If you are comfortable buying WSHR (or SPUS/HLAL) through a self-directed brokerage, you save roughly 0.40-0.50% per year in management fees. On a $100,000 portfolio, that is $400-$500 annually - money that compounds over time. But if you prefer to set it and forget it, a managed halal portfolio ensures your investments remain Shariah-compliant without any effort on your part.

Holding Halal ETFs in Your TFSA, RRSP, and FHSA

One of the most common questions from Canadian Muslim investors is whether halal ETFs can be held inside registered accounts. The answer is yes - emphatically. The CRA does not screen investments for religious compliance. Any ETF listed on a designated stock exchange (which includes the TSX, NYSE, and NASDAQ) is a qualified investment for your TFSA, RRSP, RESP, FHSA, and other registered accounts.

Here is how each account type works with halal ETFs:

• TFSA: Ideal for halal investing. All growth is tax-free, withdrawals are tax-free, and the full balance is accessible for Zakat calculation. No US withholding tax issues with Canadian-listed WSHR.
• RRSP: Excellent for tax-deferred growth. Contributions reduce your taxable income today, and US-listed ETFs (SPUS, HLAL) are exempt from the 15% US withholding tax under the Canada-US tax treaty. This makes the RRSP the best account for US-listed halal ETFs specifically.
• FHSA: If you are a first-time home buyer, the First Home Savings Account offers both a tax deduction on contributions and tax-free withdrawals for a home purchase. Halal ETFs can be held here. Note that US withholding tax does apply in the FHSA (similar to the TFSA).
• RESP: You can hold halal ETFs in an RESP for your children's education savings. The government CESG grant (20% match) still applies regardless of what investments you hold inside the RESP.
• Non-registered: Halal ETFs in a taxable account are subject to capital gains tax on sale and tax on distributions, just like any other investment. No special tax treatment applies. If you inherit halal ETFs from a deceased family member, the estate faces a separate deemed disposition — see our guide on capital gains on inherited ETFs in Canada for how the 2026 inclusion rate applies to the estate's capital gain at death.

Performance: How Do Halal ETFs Compare?

A common concern is that restricting your investment universe to Shariah-compliant companies means sacrificing returns. The historical data tells a more nuanced story.

The MSCI World Islamic Index - the primary global benchmark for halal equity investing - has performed broadly in line with the conventional MSCI World Index over the long term. In some periods, it has outperformed; in others, it has underperformed. The key structural differences are:

• Technology overweight: Because financial companies are largely excluded from Shariah-screened indices, technology stocks (which typically carry low debt) receive a larger allocation. This was a significant tailwind during the tech-driven bull market of 2020-2024.
• Financial sector underweight: Banks, insurance companies, and REITs are mostly excluded. This hurt performance during periods when financials rallied but provided protection during the 2008 financial crisis and similar events.
• Low-leverage bias: The 33% debt-to-assets screen means Shariah-compliant portfolios hold companies with healthier balance sheets on average. In economic downturns, lower leverage typically means smaller declines.
• Exclusion drag: Having a smaller investable universe means slightly less diversification and the possibility of missing top-performing stocks that happen to fail Sharia screens.

The practical takeaway: halal investing does not require a meaningful return sacrifice over the long term. The MER premium (0.30-0.40% higher than conventional index ETFs) is the more tangible cost difference, and for most investors, it is a reasonable price for Shariah compliance.

How to Get Started: Step-by-Step

If you are a Canadian Muslim investor ready to build a halal ETF portfolio, here is a practical roadmap:

1. Open the right account: If you have TFSA contribution room, start there - it is the most flexible and tax-efficient account for halal investing. If you have a high income and want the tax deduction, open or use an RRSP. First-time home buyers should consider the FHSA.
2. Choose your approach: Self-directed (buy WSHR/SPUS/HLAL yourself) or managed (Wealthsimple Halal Investing or Manzil). Self-directed saves 0.40-0.50% in annual fees.
3. Fund your account: Set up automatic contributions - even $200-$500 per month builds wealth steadily over time through dollar-cost averaging.
4. Buy your halal ETFs: For most investors, WSHR alone provides sufficient diversification. If you want additional US exposure, add SPUS in your RRSP (to avoid US withholding tax).
5. Rebalance annually: Check your allocations once or twice per year and rebalance if they have drifted significantly from your targets.
6. Track for Zakat: Record the market value of your investments on your annual Zakat date. WSHR publishes Zakat-relevant information to help with this calculation. For a detailed guide, see our complete Zakat guide for Canadian registered accounts.

Purification of Income

Even within a Shariah-screened ETF, a small amount of non-compliant income may be generated. This happens because the 5% revenue threshold means a company earning 4% of revenue from a non-compliant source still passes the screen. Most Islamic scholars require that this small impermissible portion of income be "purified" by donating it to charity (without the intention of receiving religious reward for the donation - it is an obligation, not a voluntary act of charity).

Many halal ETF providers publish an annual purification ratio - the percentage of distributions that should be donated. For example, if the purification ratio is 2% and you received $1,000 in distributions, you would donate $20 to charity as purification. This is separate from your Zakat obligation. Check your ETF provider's website or annual report for the current purification ratio.

Working With a Financial Advisor

For Canadian Muslim families in the GTA with growing wealth - especially those navigating major financial transitions like an inheritance, business sale, or career change - a financial advisor who understands both the Canadian tax system and Islamic finance principles is invaluable. The right advisor can help you optimize your portfolio across TFSA, RRSP, FHSA, and non-registered accounts while maintaining full Shariah compliance.

Beyond portfolio construction, an advisor with Islamic finance knowledge can assist with integrating Zakat into your annual cash flow plan, structuring your estate in accordance with both Ontario law and Islamic inheritance principles, and ensuring that your entire financial life - not just your investments - is aligned with your values. In Mississauga, Brampton, Scarborough, Markham, and across the GTA, the demand for this specialized advice is growing rapidly.