In the recent RRSP season — the four months of November 2007 through February 2008 — Toronto-based RBC Asset Management Inc. dominated. Its $6.4 billion in total net sales (including money market funds) set the pace. But in a season that was distinguished by the sale of money market funds, RBCAM also was top dog when it came to gathering long-term assets.

Economic uncertainty and the impact of the global credit crunch played their part this RRSP season in sending investors running for cover. Out of total net sales of $11.2 billion, $10.9 billion in net new money went into money market funds. It seems that many inves-tors, unsure of the outlook for financial markets, sold out of equity and fixed-income funds — resulting in net redemptions in those categories of $2 billion and $793 million, respectively — and parked their cash in money market funds. Those fund families that managed to gather net long-term assets (excluding money market funds) were fighting an uphill battle.

Fidelity Investments Canada ULC was one of them. Second only to RBCAM in net sales of long-term funds, the Toronto-based fund company was as pleased as punch with the recent season. Fidelity believes it is bucking the industry trend because of the quality and track record of its large global investment team, its strong wholesale team and its product lineup, which includes broadly diversified balanced products that minimize downside risk. Certainly, for the year ended Dec. 31, 2007, 85% of Fidelity’s long-term assets were in funds with first- or second-quartile performance.

The momentum Fidelity is enjoying started this past summer. “Net sales from July forward were very strong,” says Jaime Harper, senior vice president of advisor distribution with Fidelity. “When the news of the U.S. subprime [mortgage] and asset-backed commercial paper credit crunch hit, we started to see a lot of advisors go to asset-allocation products.”

Money flowed into Fidelity’s six managed portfolios. This is confirmed by the $2.9 billion in net new money overall that went into the balanced funds category, which include portfolio or asset-allocation funds, in the recent RRSP season.

Scotia Securities Inc. also enjoyed momentum going into the RRSP season. Glen Gowland, managing director and head of Scotia Mutual Funds, says the fund family’s long-term assets grew at three times the industry rate in 2007.

Gowland, who believes Scotia is the leader in packaged fund-of-funds products, says it, too, has seen money go into balanced products, including its Select portfolios: “We find that what takes people out of the market is volatility.”

Scotia has made a number of changes in the past year. It has added to its in-house portfolio managers, revamped the family’s global lineup and hired some of whom it considers to be the best global managers.

At Manulife Investments, net sales benefited from the success of the Manulife Income-Plus segregated funds, which are invested in Manulife mutual funds and, thus, count as sales for those funds. Income-Plus guarantees an income stream rather than the principal invested. Such products appeal not only to baby boomers approaching retirement but also to investors put off by the market turmoil.

The product category has become so popular that other companies have introduced their own versions — including Fidelity. Although Fidelity’s product won’t have any guarantees, it is designed to produce an income flow that rises at least as fast as inflation.

Toronto-based Dynamic Mutual Funds Ltd. which was third in net long-term net sales, describes the recent RRSP season as “quite good.” Its net sales weren’t quite as good as they look, however, because they include $212 million for DMP Resource Class, which gets money from the conversion of closed-end resources funds each January. So, it’s not new money. Nevertheless Dynamic sales are impressive.

Jordy Chilcott, senior vice president and national sales manager with Dynamic, believes the fund family benefits from the investment culture than pervades the company. CEO and president Ned Goodman continues to manage money, and his son David, president and CEO of DundeeWealth Inc., has previously run Dynamic’s investment arm, Goodman & Co. Investment Counsel Ltd.

Chilcott also believes Dynamic has one of the best wholesaling teams and call centres in the country. As well, Dynamic has invested in training and adding value for advisors, as well as advertising.

@page_break@Although Calgary-based Mawer Investment Management Ltd. isn’t big enough to make the list, the firm also did well in this RRSP season. With only $1.8 million in assets under management as of Feb. 29, Mawer had $158 million in net sales. That’s in spite of the fact its no-load funds aren’t marketed, says David Stone, Mawer’s director of marketing and sales and one of 12 owners of the firm.

One reason for Mawer’s fund sales may be the investment style: growth at a reasonable price, with a value tilt. So, says Stone, the Mawer funds have “pretty good downside protection,” which probably adds to their appeal.

The Mawer funds have high minimums and are sold mainly to private clients, although there are versions that are in other mutual fund company lineups. But Mawer is putting its toe into the retail advisory channel with the recent launch of F-class versions of its funds. This won’t be accompanied by a big advertising campaign, however.

There is no denying RBCAM’s success this past season. David Rich-ardson, RBCAM’s vice president, says RBCAM is seeing more people in the bank-branch channel contribute to RRSPs, although the average contribution was down this year. There is also a trend toward later and later contributions.

The bulk of the new money at RBCAM funds went into money market funds — $5.4 billion of the $6.4 billion in net sales. In terms of long-term funds, Richardson says, RBCAM also is seeing more and more investor money going into packaged solutions.

On the net redemption side, Toronto-based AIM Funds Manage-ment Inc. took the biggest hit — $1.8 billion. That undoubtedly reflects poor investment performance in 2007, when only 9.6% of long-term assets were in funds with above-average returns.

The $240 million in net redemptions at Toronto-based Franklin Templeton In-vestments Corp. didn’t surprise the company. Chief financial officer Dennis Tew says this RRSP season wasn’t a “particularly bad one,” given that the company’s value style is out of favour. He notes January was the only month in which the company had overall net redemptions. Franklin Templeton’s investment performance in 2007 was relatively weak, with 42% of long-term assets in funds with above-average performance.

Like everyone else, Drew has noticed the interest in balanced and managed-money programs. He feels that Franklin Templeton’s Quotential managed-money program is particularly suited to these markets. Low-risk programs tend to outperform in down markets.

More surprising is Altamira Investment Services Inc. of Toronto, which had $99 million in net redemptions in long-term funds, despite the company’s very good 2007 investment performance (69.4% of its fund assets were in the first or second quartile). Altamira’s Meritage portfolios had net sales of only $19 million for the RRSP season, but most of its other funds were in net redemptions.

Parent National Bank of Canada is folding Altamira into Montreal-based National Bank Securities sometime this year. This will open up the bank’s branch network to distribute of the funds.

Also under the gun is Toronto-based AGF Funds Inc. It had appeared to have put an end to its long struggle following the loss of U.S. investment manager Brandes Investment Partners LP as its money manager in 2002, when that company set up shop in Canada. In the six months ended May 31, 2007, AGF had net sales of $1.9 billion. Net sales slowed to $342 million in the June-August period and to $123 million in September-November — not alarming, given market conditions. But there were net redemptions of $8 million in December and $196 million in January, and only a tepid $23 million in net sales in February — despite the fact that AGF continues to have good investment performance, with 59% of long-term assets in funds with above-average returns.

Rose Cammerari, AGF’s senior vice president of national advisor sales and product marketing, says investors are “nervous and hesitant.” But she’s confident AGF will see assets coming in once markets recover.

In the meantime, AGF’s Elements Portfolios are attracting money, with AGF Elements Balanced Portfolio ranking 24th among the top 25 individual long-term funds in net sales. The other five Elements portfolios also had net sales, for a combined total of $88 million. However, AGF’s Harmony pools and portfolios didn’t do well, with net redemptions of $22 million.

Also surprising is Toronto-based Mackenzie Financial Corp. , which finally had good performance in 2007 after a number of years of weak results. Yet, it had net redemptions of long-term funds in November-February of $607 million.

David Feather, president of Mackenzie Financial Services Inc., says there’s probably a lag before advisors notice the improved performance. The redemptions are also a reflection, he says, of funds sold in 2001 with deferred sales commissions being redeemed. Gross sales have been strong, he adds; they were $1.8 billion in the recent RRSP season, although redemptions were $2.4 billion. IE

FOR TOP-SELLING INDIVIDUAL FUNDS, SEE PAGE 47