US equities were among the main focus for ETF investors last month
Canadian ETFs continue to generate positive flows according to the latest report from National Bank of Canada.
Its July 2024 Canadian ETF Flows report shows $5.2 billion inflows to funds last month, easing back to levels more in line with April and May following the new all-time record high of $9.7 billion recorded in June.
This time it was equities rather than bonds that produced the best results as investors broadened their picks from US technology mega-caps to include small-cap, equal weighted, and financials. The latter sector was aided by strong earnings reports from US banks.
Equities recorded $2.6 billion in net new assets with US stocks taking the largest share at $2.3 billion, followed by the international category at $1.4 billion. Canadian equities posted net redemptions of $1 billion with financials, energy, utilities, and tech showing weakness while real estate and materials saw inflows.
For fixed income ETFs inflows totalled $1.7 billion amid widespread gains, there were small inflows for commodities ($42 million) and crypto assets ($69 million) while multi-asset funds ($637 million) enjoyed a solid month and inverse/levered ETFs saw $147 million created. Fixed income’s weaker areas were preferred shares, real return (TIPS/F) and sub investment-grade ETFs, the only sub-sectors not to see net inflows.
July’s stats bring year-to-date inflows for Canadian ETFs to $38.8 billion, led by $21.7 billion for equities with fixed income at $13.9 billion. For the equities funds 50% of inflows were focused on US stocks.
Crypto-asset ETFs posted YTD outflows of $534 million, likely in part to the new options available in the US, however the report shows outflows from Canadian crypto ETFs are slowing.
There were 19 new ETFs launched in July with a wide range of strategies including a suite of CIBC target maturity bond ETFs. Overall, Vanguard leads the inflows among all providers with $1.3 billion in creation and is third in market share behind BMO in second place and RBC iShares at number one.
