Nation Bank says exchange-traded funds had a strong month in April
Canada’s ETF industry saw another strong month in April, with $5.3 billion created as all but one of the major asset classes posted positive results.
National Bank’s monthly Canadian ETF flows report shows that equities were the clear driver of the funds’ growth, especially U.S. equities which accounted for $2.1 billion of the $4.0 billion net flows to the asset class. International equities posted a net $1 billion with Canadian equities at $831 million.
Fixed income ETFs saw new flows of $868 million, despite a large scale exit from cash like money market funds which suffered their largest monthly outflow at $865 million. The analysis reveals a divergence between money market securities ETFs, which have seen net inflows throughout 2024 so far, and cash alternative ETFs which have seen net outflows over the last three months.
Elsewhere, multi-asset ETFs recorded net flows of $326 million, inverse/levered $72 million, and commodities $52 million. But crypto ETFs had a weak month with a net $46 million withdrawn from these funds, a slower pace than in February, but indicative of the wider softening of investor interest in risk assets.
Year-to-date, there were $19.2 billion in new ETF assets created in the first four months of 2024 with $14.3 billion going to equities (half of which was to U.S. focused funds).
ETF providers
ETF providers that have their funds concentrated in narrow ranges of asset classes suffered larger outflows, such as those focused on money markets and cryptos.
April also saw more choice for investors as 30 new funds were launched, the most in a single month so far this year. This was driven by RBC and TD which introduced new suites of target maturity bond ETFs. There were also new buffer ETFs, building-block broad-based ETFs and covered call ETFs launched.
RBC iShares, BMO, and Vanguard were the three leaders by flows with market shares of 28%, 22%, and 14% respectively.
The rebranded Horizons ETFs funds, now Global X, were fourth with a 7% market share and CI Global Asset Management are fifth with a 6% market share.
