Canada-listed exchange-traded funds brought in a record C$13.6 billion ($9.5 billion) in March, beating the high set in December by 28 per cent.
The inflow boosted ETF assets under management to C$545 billion as of March 31, according to National Bank of Canada, led by a C$6.3 billion injection to fixed-income funds.
“ETF volume usually spikes up during volatile markets,” said Bloomberg Intelligence analyst Athanasios Psarofagis. The vehicles are “really the fastest, more efficient way to make trades and reallocate risk.”
Geopolitical uncertainty increased interest in international equity ETFs, which don’t include U.S. ETFs.
That category “saw a sudden C$3.8 billion explosion in demand as investors flock overseas to sidestep a potentially damaging trade war,” National Bank analyst Daniel Straus wrote in a note to clients. A desire to diversify away from an overvalued US equity market also contributed to that demand, he added.
Broad US equity ETFs were among those with the most outflows in March, although inflows to the category overall were still positive at C$737 million.
Weekly ETF trading hit a record high of C$30 billion during the first week of the month, Psarofagis found.
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