Total RRSP season mutual fund sales are down so far this year, but long-term fund sales are much stronger.

The Investment Funds Institute of Canada reported today that net sales, excluding re-invested distributions of $174.2 million, totalled $4.2 billion in February.

For the year to date, fund sales total $7.1 billion, down about 6% from the same period last year. However, the all-important long-term fund sales are up 21% in the period year over year. The weakness is in the short-term sales, down 59% year over year.

“Net new sales in February are up 67% from last month,” states Tom Hockin, IFIC’s president and CEO. “The trend towards longer term investing also continued in February. Long-term fund sales comprised 98% of the new money invested compared to 67% last February. Canadians are realizing the benefits of investing in equity markets and with the economy making its way towards a recovery, they feel the time to invest into long-term funds is now.”

Indeed, of the $4.2 billion in February net sales, more than $4 billion of it came in long-term funds. The sales were pretty broadly distributed among asset classes. Foreign equities led the way with $818 million in net sales, followed closely by the balanced funds at $780 million. Canadian equities enjoyed $665 million in monthly net sales, followed by U.S. equities at $614 million.

Another $460 million went into bond & income funds; followed by $430 million into dividend funds, and even $247 million into foreign bond funds. Investors even placed a bit of money into the moribund mortgage and real estate categories.

The bank-owned fund companies continued to perform well in February, despite the shift away from short-term funds. Among the independents, AIM was the big winner in the month, with its assets gaining 2.5%, compared to 1.1% for the industry overall. Clarington and Guardian had strong months, too.

Among the big players, Mackenzie and Franklin Templeton were relatively strong. Altamira was a real dog, with assets dropping 2.7% in the month. The only other top-30 firms to see asset losses were the former Merrill Lynch asset management arm, CM Investment Management, and StrategicNova.

IFIC also reported the total number of unitholder accounts rose 3.5% to 52.8 million. Total assets under management increased in February to $431.7 billion, up 1.1% from $427 billion in January. Assets are up 4.6% from last February’s figure of $412.7 billion.