Income a priority for ETF investors

Canadian fixed income ETFs experienced 8% growth in assets under management (AUM) in the second quarter of 2011, including $633 million in net new assets, according to information compiled by the iShares ETF business at BlackRock Asset Management Canada.

Conversely, Canadian equity ETFs experienced an 8% contraction in AUM and $691 million in net outflows.

“In these uncertain economic times, investors have made income generation a priority and sought the safe harbour of fixed income investments,” said Mary Anne Wiley, head of iShares distribution, BlackRock Canada.

Overall ETF asset dropped in the second quarter, partly resulting from significant weakness in the equity markets. Total AUM of Canadian ETFs was $39.7 billion in Q2, compared to $41.4 billion AUM in Q1, representing a 4% drop.

iShares ETFs continue to be the market leader amongst all the providers with 70.5% of market share and $28 billion in AUM, followed by Claymore Investments with 15.8% of the market and $6.3 billion in AUM.

“In addition to the outflows we’ve seen for Canadian equities we have seen significant outflows for inverse ETFs in the second quarter,” said Wiley.

Staff

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