The world by weight
MSCI ACWI Index, August 31, 2026. These shares move as markets move.
A market with a particular shape
Canada's stock market leans on a few industries. In January 2026, about 32% of the main Canadian index was financial companies, about 18% was materials (mostly mining) and about 15% was energy. That's roughly two-thirds in three sectors. A Canada-only portfolio inherits that shape.
Home bias
Investors in almost every country hold far more of their home market than its share of the world. It's called home bias. For Canadians there are some practical reasons behind it:
- No currency swings. Your spending is in Canadian dollars, and so are Canadian stocks.
- Tax treatment. In a non-registered account, dividends from Canadian companies get a tax credit that foreign dividends don't.
- Familiarity. People prefer companies they know.
Many all-in-one funds sold in Canada are built with more Canada than 3% for those reasons. That's a design choice by the fund company, and it's published on the fund's page.
What to do with this
There's no single correct split, and reasonable investors disagree. The useful step is to know your own mix. If almost everything you hold is Canadian, you're leaning on one country and a few industries. If almost nothing is, your results will depend more on foreign markets and on the exchange rate, which is the next lesson.
Do this before the next lesson
- For each fund, find the geography or country breakdown on its page.
- Estimate your overall split in three buckets: Canada, United States, everywhere else.
- Compare it with the chart above and write one line: "My Canada share is __%, and that is on purpose because ___."
Roughly how much of the world's stock market value is Canadian?
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Where this comes from
- MSCI ACWI Index factsheet, August 31, 2026 (country weights)
- Sector mix of the S&P/TSX Capped Composite Index, as reported in the ETF Facts of a fund that tracks it (BMO, January 23, 2026): financials 32.2%, materials 17.6%, energy 15.4%. Cited as a data source only, not as a recommendation
- Canada Revenue Agency: dividend tax credit for dividends from taxable Canadian corporations