ETFs just turned 30, and investors are taking note

Thirty years after the first Canadian ETF launched, investors are more interested than ever in adding ETFs to their portfolios, says a recent study from Mackenzie Investments.

The first ETF started trading on the Toronto Stock Exchange on March 9, 1990. According to Mackenzie, the majority of Canadian investors plan to either expand their ETF holdings (86%) or include ETFs for the first time within their portfolios (52%) in the next two years.

Investors said the biggest benefits of ETFs were low fees (62%), diversification opportunities (62%) and strong liquidity potential (59%). Sixty-one per cent of investors said they prefer to purchase their ETFs from local providers.

Canadian ETFs broke records in 2019, attracting $28 billion in inflows and outselling mutual funds for the second straight year. In November, Canadian ETF assets crossed the $200-billion milestone. 

Interest in environmental, social and governance (ESG) ETFs also increased, with the number of products growing to at least 25 pure-play ESG ETFs in Canada at the end of last year. 

There are now more than 760 ETFs listed in Canada, accounting for $211 billion in assets under management (AUM) as of Jan. 31, 2020, according to the Canadian ETF Association (CETFA).

Below are highlights from our recent ETF coverage to keep you up to date on the latest news and trends:

• Despite market turmoil, ETF assets held steady in a record-breaking month
• Are low-volatility equity ETFs performing as planned?
• Where do thematic funds fit in a portfolio?
• Factor investing: what you need to know
• New structure for tax-advantaged investing coming to Canada
• ETFs and the future of investment management

The Mackenzie study was conducted by Pollara Strategic Insights, which polled an online sample of 1,500 adult Canadians between February 14–20, 2020. Online surveys cannot be assigned a margin of error because they do not randomly sample the population.

Maddie Johnson

Maddie is a freelance writer and editor who has been reporting for Advisor.ca since 2019.