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In a year that’s seen ETF investors content to park money in cash alternative and short-term bond funds, risk appetite returned somewhat in June with interest in equities and crypto picking up.

A report from National Bank Financial said $4.4 billion flowed into ETFs in Canada last month, bringing the first-half total to $19.7 billion. That’s 17% higher than at the midway point of 2022, when stock and bond markets were tanking.

Fixed income dominated first-half flows, accounting for $11.2 billion compared to $6.5 billion for equity ETFs.

“[T]he craze for money market or ‘cash-like’ exposure seems unstoppable, especially now that these ETFs are yielding in the neighbourhood of 5%,” National Bank said.

Money market ETFs had inflows of $5.6 billion for the six months through June 30, followed by Canadian government bond ETFs at $2.6 billion and Canada aggregate bond funds at $1.8 billion.

Equities made something of a comeback in June, bringing in $1.8 billion compared to just under $2 billion for fixed income, as sentiment improved and the rally in U.S. large-cap stocks broadened to other sectors and regions, the report said.

“We now observe a shared appetite for both equities and fixed income, and this reflects the new economic reality after a year of aggressive rate increases by the central banks in efforts to clamp down inflation,” National Bank said.

Equity ETFs that saw the largest inflows in the first six months of the year were sector-specific (financials and health care), ESG and dividend-focused, according to the report.

Even crypto funds saw a bounce in June, bringing in $337 million, the highest since May 2022. That pushed crypto ETFs into positive territory ($35 million) for the year. National Bank attributed the renewed interest to BlackRock’s filing in the U.S. for a spot Bitcoin ETF.