Mutual fund industry net sales were $646 million in July, but all of that came in money market funds, long-term funds were in net redemptions for the month.

According to data from the Investment Funds Institute of Canada released today, sales were down notably from last month’s $1.6 billion, and $3 billion in July 2007.

All of the action was in money market funds, which had $1.36 billion in net sales. Long-term funds suffered over $700 million in monthly net redemptions, and they only did that well thanks to net sales in fund-of-fund products. Long-term stand-alone funds had redemptions of $1.14 billion, up from $248 million in redemptions in June.

In July, $1.13 billion went into Canadian money market funds, which is more than four times the sales in July 2007. It is also more than three times the sales of the next best-selling category, Canadian neutral balanced, at $372.5 million. Money market funds have attracted $15.3 billion in sales since the start 2008 and $20.2 billion in sales over the last 12 months, IFIC reported.

IFIC also noted that all equity asset classes were in net redemption territory for the month, with the exception of sector equity funds, which had $19.9 million in sales for July. International equity funds had the heaviest redemptions — $589.1 million.

RBC led the sales charts, with $678 million in overall net sales. By itself, RBC’s funds had o’er $900 million in net sales, but this was partly offset by redemptions from its newly-acquired PH&N brand.

Fidelity Investments Canada led the long-term net sales, with $367 million; followed closely by Dynamic Funds at $357 million. The newly-renamed Invesco Trimark had the largest long-term net redemption total of $540 million.

IFIC also reported that total industry assets were $685.4 billion at the end of July, down from $700.1 billion last month and $703.5 billion at this time last year.