Fund sales strong despite market jitters: IFIC

Volatility in the world’s equity markets doesn’t seem to have put a damper on fund sales during the month of July, according to preliminary data from the Investment Funds Institute of Canada.

Funds for the month of July are estimated to be between $2.7 billion to $3.2 billion, substantially higher than June’s total of $1.9 billion, and potentially twice the July sales of 2006.

Assets under management didn’t fare quite as well. IFIC estimates the industry’s total AUM was down approximately 0.45% from last month’s total of $706.8 billion.

“With estimates of July’s long-term fund sales in the range of $2.5 billion, investors continued their commitment to mutual funds as a source of long-term investment solutions,” said Pat Dunwoody, vice-president, member services & communications, at IFIC. “Mutual fund assets under management fell by only 0.45% despite the increased volatility in capital markets.”

Although no analysis of what drove the strong trends is available, RBC Asset Management took a significant chunk of business. The company reported $477 million in net sales, $454 million of that in long-term fund sales bringing its yearly net sales total over the last 12 months to $8.1 billion.

At a distant second in reported sales is Dynamic Mutual Funds, which reported a $281 million in net sales, $277 million of that coming from long-term fund sales.

Joining Dynamic and RBC in the $200 million plus club were Scotia Securities and Fédération des caisses Desjardins, with $205 million and $200 million in net sales respectively. Both companies recorded $201 million in long-term sales.

BMO Financial Group, which includes BMO Investments and Guardian Group of Funds, also posted solid $175 million in long-term fund sales. However a large portion of this was offset by $85 million in redemptions of its money market funds dragging its total net sales down to $88 million.

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