Mutual fund and ETF assets increased in April

After a withering March, mutual fund sales rebounded in April, according to the latest data from the Investment Funds Institute of Canada (IFIC).

The industry trade group reported that mutual funds recorded $1.25 billion in net sales in April, following $14.1 billion in redemptions in March.

Equity funds led the way, with more than $1.3 billion in monthly net sales, up from $702 million in redemptions.

Balanced funds remained in net redemptions last month, although the segment’s redemptions dropped dramatically to $1.45 billion in April from more than $11 billion in March.

Bond funds returned to positive territory in April, with $833 million in net sales, after $6.7 billion in monthly redemptions.

Specialty funds also gained some momentum, with net sales rising to $565 million for April from $181 million in March.

Alongside the resumption of positive net sales, industry assets also bounced back.

IFIC reported that assets under management (AUM) rose by $91.8 billion in April, representing a 6.3% gain compared with March.

Total industry AUM finished the month at $1.54 trillion.

Despite the resumption of positive net sales in April, long-term funds remain in negative sales territory for 2020. In the year-to-date, long-term mutual funds have recorded $3.3 billion in net redemptions.

Yet, this is more than offset by the $4.6 billion in net sales for money market funds.

Looking at all fund types, overall year-to-date net sales are $1.29 billion.

While mutual fund sales surged in April, exchange-traded funds (ETFs) saw their sales slow.

Long-term ETFs recorded $446 million in monthly net sales, down from $2.95 billion in March. That slowdown was led by equity ETFs, which recorded $508 million in April net sales, down from $4.2 billion in March.

However, specialty funds generated $509 million in net sales, reversing March’s $139 million in monthly redemptions.

Bond funds also saw their redemptions improve in April, easing to $629 million last month from $1.2-billion-worth in March

Notwithstanding the slowdown in April, overall ETF sales for 2020 are well ahead of their pace in 2019: in the year-to-date, overall sales are just shy of $15.9 billion (including $14.7 billion in long-term sales), more than double last year’s total of $6.4 billion for the same period.

ETF assets also rebounded strongly in April, rising 7.3% from the previous month to $204.2 billion at the end of April.