Record delistings mar 2023 growth for Canadian ETFs

Read more: Emerge Canada urges investors to speak with FAs amid ETF terminations

ETFs also outsold mutual funds for the second year in a row. While mutual funds shed $52 billion for the year until November, with redemptions concentrated in equity and balanced funds, ETFs took in $34 billion over the same period.

Equity ETFs absorbed $13 billion last year, slightly less than in 2022. US equity ETF flows were notably muted last year, the report said, pulling in $641 million – the smallest annual figure in 10 years.

Meanwhile, 2023 was a record year for fixed income ETFs: the category took in $21.4 billion, making it the best year of inflows in history. National Bank noted a distinct “barbell-shaped” pattern in flows, with 44% going to money-market ETFs and 40% to broad-based bond ETFs. Long-term ETFs, which suffered the most from 2022’s bond drawdowns, took in the largest portion of the rest of fixed-income flows (17%).

Target maturity bond ETFs emerged as rising stars, National Bank said, as advisors showed an increasing preference for the category, particularly those maturing within three years. Canada’s fixed-income ETF space also became a touch more vibrant with the introduction of fixed income covered call ETFs for the first time: the category, which includes six ETFs so far, ended the year with $320 million.

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