Mutual fund sales for RRSP season are about half what they were a year ago. The Investment Funds Institute of Canada reported that overall fund sales for the first two months of 2008 were about $6.6 billion, down from just under $12 billion for the same period a year ago.

The picture is even dimmer if you look solely at long-term funds, which recorded less than $3 billion in net sales so far this year, compared with $11.7 billion for the period last year. This year, a much bigger contribution came from short-term funds, which were non-factors in the sales for the first two months of 2007.

In February, long-term fund sales were $2.9 billion, up from net redemptions of $4.3 billion in January but down from $7.7 billion in sales for February 2007. Short-term fund sales for February reached $3.2 billion, down $1.6 billion from January’s total.

IFIC noted that the global balanced, domestic balanced, domestic equity and domestic fixed income asset classes were back in positive sales territory in February.

Global balanced funds led the way in February with net sales of almost $1.6 billion. Domestic balanced funds had just under $900 million in net sales. On the downside, global equity funds recorded $100 million in monthly net redemptions, and US equity funds were in the red too.

IFIC also reported that fund-of-fund sales were just under $1.8 billion in February, up from net redemptions of $314 million in January (which was an anomaly due to fund closures in January), and down from $4 billion in February 2007.

RBC Asset Management led the sales parade once again in February, with $2.2 billion in monthly net sales. TD Asset Management ranked a distant second at $844 million, followed by CIBC Asset Management’s $650 million.

Most firms reported positive net sales for month, although AIM Trimark had $442 million in net redemptions, and AIC saw another $136 million in redemptions.

RBC also led the long-term net sales, with $785 million worth. Fidelity Investments Canada ranked second with $507 million in long-term sales, and TD was third with $363 million in sales.

Additionally, IFIC reported that total industry and long-term fund asset growth in February was $7.1 billion and $3.7 billion, respectively. Total assets were $678.7 billion at month end, and long-term assets reached $615.3 billion. However, asset growth has been negative on a year-to-date (-$18.6 billion) and year-over-year basis (-$1.3 billion).

“What we are seeing in February is a preference among investors for diversified fund categories particularly stand-alone funds within the domestic balanced asset class and fund-of-fund products within the global balanced asset class,” said Pat Dunwoody, IFIC’s vice president, member services & communications. “While we have seen some volatility over the last few months, long-term industry growth remains strong with total assets under management growing an average of 12.6% per year over the last five years.”

https://statistics.ificmembers.ca/English/reports/2008/02/public/IFIC_Statistical_Commentary.pdf