Fund sales rebound in September: IFIC

Fund sales appear to have bounced back from a nasty slide in August, which saw the industry finish in net redemptions for the first time in three years, according to the September sales estimates released by the Investment Funds Institute of Canada.

IFIC says that mutual fund sales will fall somewhere between $620.2 million and $1.1 billion, which will help the industry recover a good chunk of the $1.5 billion in net redemptions it suffered in August. Many of the redemptions of last month were directly tied to global market volatility and fears associated with the asset-backed commercial paper market.

“Sales industry-wide rebounded in September,” says Pat Dunwoody, vice-president of member services and communications at IFIC. “At $869 million, sales estimates are in line with what was seen last year at this time.”

The industry’s assets under management also staged a comeback. Assets at the end of September are estimated to be in the range of $698.6 to $703.6 billion, up approximately 1% from last month’s total of $695.9 billion.

In previous months individual fund companies have tended to follow the direction of the industry in sales, but September offered a mixed bag of strong performers and nasty redemptions.

On the positive side of things, RBC Asset Management and TD Asset Management both report to have drastically turned around their sales in September, after finishing August in redemptions.

RBC led the industry, finishing the month with $330 million in net new sales, and TD, which suffered $543 million in redemptions in August, finished September with $317 million in net new fund sales.

Other strong performers include Fidelity, with more than $100 million in net new sales, and Dynamic, which reported $92 million in net new sales.

AIM Trimark and National Bank are tentatively tied for highest redemptions. National Bank, which recently removed more than $2 billion in ABCP paper from its fund holdings, reported redemptions of $171 million, $104 million of which was in its money market funds. AIM Trimark reported most of its net redemption total coming from its long-term mutual funds, which were redeemed for $169 million.

Mackenzie Financial reported $122 million in net redemptions. It was solely responsible for its parent company, IGM Financial, finishing the month at $31 million in net redemptions. Brandes Investment Partners, which managed to be one of only a handful of companies that finished August in positive sales, reported $40 million in redemptions.

Filed by Mark Noble, Advisor.ca, mark.noble@advisor.rogers.com