Flows into Canadian ETFs reached $3.5B in January

January saw $3.5 billion flow into Canadian ETFs, bringing domestic ETF assets to $260 billion, according to a report from National Bank Financial.

Equities ETFs topped the leaderboard, bringing in $1.6 billion, with the majority of funds flowing to broad-based, index-tracking ETFs that invest in Canadian, U.S. and international stocks.

Financial sector ETFs saw an inflow of $307 million, while technology (-$62 million), energy (-$153 million) and materials (-$164 million) ETFs “bled assets,” the report said.

National Bank noted that investors showed a preference for thematic ETFs investing in disruptive technology, ESG and clean energy. (In a separate report, BMO Global Asset Management said that “megatrend” ETFs that invest in sectors such as disruptive technology and clean energy “captured investor interest more so than any other style of investing in 2020.”)

Multi-asset ETFs remained in favour in January, racking up net sales of $573 million, National Bank reported.

Fixed income ETFs attracted $1.3 billion last month, led by Canadian aggregate bond and government bond funds. Cash alternative and preferred share ETFs saw outflows of $93 million and $48 million, respectively.

Commodities funds had an outflow of $39 million last month as investors continued to withdraw from gold bullion ETFs “as the prospect for gold becomes blurry along with the inflation outlook,” National Bank reported.

There was a “flurry” of new product launches in January, the report noted, with 26 new funds hitting the market, bringing the total number of Canadian ETFs to 1,040.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.