Canada’s ETF industry has 24 months of consecutive net inflows as other developed markets see decreases
The ETF industry in Canada gathered net inflows of US$2.33 billion during August, bringing year-to-date net inflows to US$21.30 billion, says ETFGI, an independent research and consultancy firm. ETFGI’s ‘August 2023 Canadian ETFs and industry landscape insights report’ shows assets invested in the ETFs industry in Canada increased 14.6 percent year-to-date (YTD) in 2023, going from US$250.19 billion at the end of 2022, to US$286.77 billion.
The report says that the YTD net inflows of $21.30 billion are the third highest, behind YTD net inflows of $32.72 billion in 2021 and YTD net inflows of $23.79 billion in 2020. Canada’s ETF industry has had 24 months of consecutive net inflows. “The S&P 500 decreased by 1.59 percent in August and was up by 18.73 percent in 2023,” says Deborah Fuhr, managing partner, founder, and owner of ETFGI. “Developed markets excluding the US decreased by 3.92 percent in August and were up 10.58 percent in 2023. Netherlands (down 9.59 percent) and Hong Kong (down 9.13 percent) saw the largest decreases amongst the developed markets in August. Emerging markets decreased by 5.08 percent during the month and were up 5.44 percent in 2023. Colombia (down 12.70 percent) and Pakistan (down 11.09 percent) saw the largest decreases amongst emerging markets.”
Growth in assets
At the end of August, the ETF industry in Canada had 1,090 products, with 1,375 listings and assets of $287 billion from 40 providers listed on two exchanges.
During August, ETFs gathered net inflows of $2.33 billion. Equity ETFs saw net inflows of $213 million during August, bringing YTD net inflows to $3.97 billion, much lower than the $6.74 billion in net inflows YTD in 2022. Fixed income ETFs had net inflows of $1.06 billion during August, bringing YTD net inflows to $5.03 billion, higher than the $2.42 billion in net inflows fixed income products had YTD in 2022. Active ETFs attracted net inflows of $1.22 billion during the month, gathering YTD net inflows of $12.02 billion, significantly higher than the $8.22 billion in net inflows YTD in 2022.
Substantial inflows can be attributed to the top 20 ETFs by net new assets, which collectively gathered $2.93 billion during August. Horizons US 7-10 Year Treasury Bond ETF - Acc (HTB CN) gathered $560.22 million, the largest individual net inflow.