Unlocking Monthly Income Potential with Global X Enhanced S&P/TSX 60 Index ETF (CANL)

For income-focused investors navigating a rising rate environment, the Global X Enhanced S&P/TSX 60 Index ETF (CANL) has emerged as a compelling option. With a trailing yield of 3.09% and a disciplined monthly dividend schedule, CANL offers a unique blend of consistency and growth potential. However, its 0.35% management fee and broader expense structure require careful evaluation against traditional Canadian equity investments. This article dissects CANL's strengths, costs, and strategic appeal for long-term income seekers.

Dividend Consistency: A Reliable Income Stream

CANL's dividend history demonstrates a pattern of reliability, with monthly payouts maintained since at least July 2024. Over the past year, the ETF increased its distribution from $0.07 to $0.075 per unit—a 7.14% boost—highlighting its ability to adapt to market conditions while preserving regularity. The 12-month trailing yield of 3.09% (as of July 31, 2025) underscores its appeal for investors prioritizing steady cash flow.

However, the current yield based on the stock price of CA$28.73 stands at 0.26%, a stark contrast to the trailing figure. This discrepancy reflects the impact of recent price volatility on forward-looking yields. Investors must monitor this metric, as it could fluctuate with market sentiment or changes in the ETF's net asset value (NAV).

Expense Efficiency: A Mixed Picture

CANL's 0.35% management fee appears reasonable at first glance, but a deeper look reveals a more nuanced cost structure. While the fee is within the typical range for Canadian equity ETFs (0.10%–0.50%), it lags behind ultra-low-cost alternatives like the Vanguard FTSE Canada All Cap Index ETF (VCN, 0.06%) or the Horizons S&P/TSX 60 ETF (HXT, 0.04%).

The ETF's total Management Expense Ratio (MER) of 1.65%—which includes service fees, marketing, and other operational costs—further differentiates it from peers. This higher MER could erode long-term returns, particularly for investors holding the ETF for decades. For context, the average MER for Canadian equity ETFs in 2025 is around 0.06%, with some options dipping as low as 0.04%.

Strategic Positioning: Canadian Equity Exposure in a Rising Rate World

CANL's focus on the S&P/TSX 60—a basket of Canada's largest and most liquid equities—positions it as a high-yield alternative to traditional equity holdings. Large-cap Canadian stocks, particularly in sectors like energy and financials, have historically demonstrated resilience in rising rate environments. CANL's monthly dividend schedule further enhances its appeal, offering investors a predictable income stream that can be reinvested or used to offset inflationary pressures.

In contrast, traditional Canadian equity mutual funds typically carry higher expense ratios (0.90%–1.20%), making CANL a more cost-effective option for passive investors. However, its higher MER compared to top-tier ETFs like HXT suggests that cost-conscious investors should weigh the trade-off between dividend consistency and total fees.

Investment Advice: Balancing Yield and Costs

For long-term income investors, CANL's 3.09% trailing yield and monthly payouts make it a strong contender, especially in a market where bond yields are rising but equity dividends remain competitive. However, the ETF's expense structure—particularly its 1.65% MER—demands scrutiny. Investors should consider the following:

1. Diversification: Pair CANL with lower-cost ETFs like VCN or HXT to balance yield and fees.
2. Time Horizon: The ETF's modest dividend growth (5.63% annualized over the past year) suits investors with a 5–10 year horizon.
3. Market Conditions: Monitor the ETF's NAV and stock price to assess yield sustainability, especially in a volatile rate environment.

Conclusion

The Global X Enhanced S&P/TSX 60 Index ETF (CANL) offers a compelling mix of dividend consistency and Canadian equity exposure, making it a strategic choice for income-focused investors. While its 3.09% trailing yield and monthly payouts stand out, the 0.35% management fee and 1.65% MER highlight the importance of cost discipline. In a rising rate environment, CANL's alignment with large-cap Canadian equities and its ability to deliver regular income position it as a high-yield alternative to traditional holdings—but not without trade-offs. Investors should prioritize a balanced approach, leveraging CANL's strengths while mitigating its cost-related risks.