Mutual fund net redemptions eased in May, while ETF sales dipped a bit too but stayed in positive territory, according to new data from the Investment Funds Institute of Canada (IFIC).
The fund industry trade group reported that mutual funds saw $1.8 billion in net redemptions last month, which marked an improvement from $2.7 billion in net redemptions in April, and $3.8 billion for the same month a year ago.
Balanced funds led the way with $3.3 billion in net redemptions, which was in line with the previous month.
Equities fund redemptions also surged to $920 million in May from just $14 million in April.
This redemption activity was partly offset by a surge in bond fund sales, which jumped to $1.35 billion in May from $366 million in April.
Specialty fund net sales also remained in positive territory in May, generating $623 million in monthly net sales, down from $720 million in April.
Money market funds turned positive too, with $464 million in monthly net sales.
“Money market mutual fund net sales turned positive after three consecutive months, with just over half of all money market funds experiencing positive inflows,” IFIC said.
Despite the ongoing net redemption activity, mutual fund assets gained 2.2% in May, climbing by $44.4 billion to $2.06 trillion.
IFIC reported that mutual fund assets under management (AUM) are now up to their second highest monthly total on record.
Yet, the ETF side of the industry continued to outperform mutual funds, with net sales of $4.4 billion, and assets up $15.6 billion to $429.2 billion — a 3.8% gain.
IFIC noted that, year-to-date, ETF assets are up 12.4%, “which is close to double the growth in absolute terms compared to 2023,” it said.
ETF net sales in May were powered by equities funds, which generated monthly net sales of $2.8 billion. That’s down from over $4.0 billion in the previous month.
Bond ETF sales also dipped from $1.7 billion in April to $1.3 billion in May, balanced fund sales declined from $362 million in the previous month to $243 million, and specialty fund sales fell from $82 million to $22 million.