Fund industry hit with redemptions

The Canadian mutual fund industry was hit with redemptions in October, with investors pulling out somewhere between $262.2 million and $762.2 million, according to preliminary data from the Investment Funds Institute of Canada.

“Markets took a breather at the end of October which capped off seven months of exceptional growth in assets under management,” said Pat Dunwoody, vice-president of member services and communications with IFIC. “Assets remain about $50 billion above where they were at this point last year and we continued to see strength in long-term fund sales last month.”

Net industry assets at the end of October were between $569.3 billion and $574.3 billion, down 1.87% from September’s total of $582.7 billion.

CI Financial reported net sales of $191 million for the month of October, with net long-term fund sales of $196 million between its two subsidiaries, CI Investments and United Financial. Investors pulled $5 million out of money market funds.

Assets under management at month end were $63.7 billion, including investment funds and structured products totalling $59.7 billion, and $4.0 billion in institutional assets.

DundeeWealth reported net sales of $180 million, with $322 million in net long-term fund sales partially offset by money market redemptions. Total mutual fund assets under management at the end of October were just under $24 billion.

TD Asset Management reported total net fund sales of $158 million, with long-term fund net sales totaling $624 million, and money market fund net redemptions of $466 million. Assets under management totaled $53.2 billion as of the end of October.

“For the second straight month, we have experienced record net sales of our long-term funds, capping off what has been a period of tremendous momentum for our business,” said Thomas Dyck, president, TD Mutual Funds. “We are especially proud to have finished the fiscal year ending October 31st in number one position for net sales of long-term funds in Canada.”

Investors Group reported $29.4 million in net new money, with $28.5 million in net long-term fund sales. Total assets at the end of the month were $55.3 billion, up $5 billion from October 2008.

Mackenzie Financial announced total net redemption of $197.5 million, including $181.6 million in net redemptions from long-term funds and $15.9 million in net money market fund redemptions.

The company ended the month with $61.4 billion in assets under management, up from $57.2 billion at the end of October 2008.

AGF Management reported net redemptions of long-term mutual funds were $65.2 million, with another $13.1 million pulled from money market funds. The company also reported total mutual fund assets under management of $22.2 billion at month end.

RBC Asset Management and Phillips, Hager & North announced net redemptions of $884 million, with $1.4 billion coming out of money market funds. Long-term funds experienced positive net flows of $477 million.

“Strong appetite for fixed income solutions translated into robust inflows into our individual mutual funds as well as our Portfolio Solutions, which attracted $303 million of net sales,” said Doug Coulter, president of RBC AM.

(11/04/09)