Mutual funds had their best month in December since the end of the last RRSP season, generating $3.2 billion in net sales, according to figures from the Investment Funds Institute of Canada. However, fund sales are still down on the year.
IFIC reported today that in December long-term fund net sales jumped to $2.4 billion, the highest monthly result since the end of the 2006 RRSP season in March.
Balanced funds were the best sellers, accounting for almost $1.5 billion of the total, followed by foreign equity funds, which had $891 million in sales and bond funds at $570 million. Canadian equity funds saw heavy redemptions however, with $750 million being cashed out of these funds.
While balanced funds were the top sellers in December, IFIC noted that the largest contributors to the month’s asset growth were foreign equity and U.S. equity funds.
The banks continued their sales dominance in December, with RBC Asset Management and TD Asset Management neck in neck for the sales lead, at $546 million and $536 million, respectively. IGM ranked third at $348 million, with CIBC Asset Management rounding out the list of firms with at least $200 million in monthly net sales. AIC, Altamira and AIM Trimark continued to see net redemptions, as did a handful of others.
Looking solely at long-term funds, RBC and TD still led the way in December, but Scotia Securities ranked third, followed by AGF Funds.
For 2006, balanced funds were the best-selling asset class, with $13.2 billion in net sales; although this down slightly from $15.2 billion in 2005. Foreign equity funds had the biggest turnaround, going from $5.5 billion in redemptions in 2005 to $6.7 billion in net sales for 2006.
Canadian equity funds saw their redemption trouble deepen in 2006, with net redemptions growing from $3.9 billion in 2005 to $7.3 billion in 2006. Dividend funds also saw their star fade, with net sales dropping from $13.2 billion in 2005 to $5.7 billion in 2006.
Overall, net sales slipped in 2006 from $22.6 billion in 2005 to $20.8 billion in 2006. The picture is a little darker for long-term funds, which saw their net sales drop from $27.3 billion in 2005 to $22.3 billion in 2006.
During 2006, long-term mutual fund assets were up by almost $90 billion, with $22 billion due to net sales and $68 billion in estimated market appreciation, IFIC reported. Total mutual fund assets ended 2006 at slightly over $660 billion, increasing 15.8% over the year.
Balanced funds post strong sales in December: IFIC
Canadian equity funds see redemptions deepen in 2006
- By: James Langton
- January 15, 2007 January 15, 2007
- 13:10