(June 15 – 17:15 ET) – According to the Investment Funds Institute of Canada’s monthly sales numbers for May mutual fund sales remain subdued, and skewed strongly toward foreign equity funds.
Including reinvested distributions, net sales for all funds in May reached $1.2 billion, down from $2.1 billion in the same month last year. This was the industry’s worst May since 1995.
Long term funds saw about $1.1 billion in net new sales last month, while almost $200 million was redeemed from money market funds. With interest rates on the rise investors appear to be dumping these funds in favour of direct fixed-income investments and equity funds.
Investors continue to plow money into foreign funds, both as foreign content and through the wildly successful RRSP-eligible derivative funds. Foreign equities accounted for just over $1 billion of the net sales, another $278 million went into U.S. equities. Canadian equities and balanced funds made modest gains, while the long-term income funds suffered net redemptions.