Morningstar's 2026 Fund Family Digest reveals how Big Six banks, global giants and boutique managers are adapting to rapid ETF
Canada's fund industry is undergoing its most significant structural shift in decades, with exchange-traded funds drawing more than twice the net flows of mutual funds over the past year.
It’s a trend that is redrawing the competitive map for the country's largest asset managers, according to Morningstar's September 2026 Fund Family Digest.
The report, which ranks the 50 largest fund families in Canada by assets under management as of June 30, 2026, found that ETF inflows were 2.5 times greater than those to open-end mutual funds over the past year, even though ETFs account for only one-quarter of combined AUM.
That gap is reshaping strategy across the industry, from the Big Five bank-owned managers to global players such as BlackRock and Vanguard, and smaller active boutiques competing on stewardship.
Bank-owned managers hold the line but face pressure
RBC Global Asset Management, the asset management arm of the Royal Bank of Canada, retained its position as Canada's largest fund family with approximately CAD 513 billion in assets under management, nearly twice that of its next-closest rivals, Toronto-Dominion Bank's TD Asset Management at CAD 287 billion and Fidelity International at CAD 262 billion, according to Morningstar Direct data as of June 30, 2026.
Together, the asset management arms of the Big Five banks (RBC, TD, Bank of Montreal, Canadian Imperial Bank of Commerce, and Scotiabank) collectively manage 47 per cent of all Canadian open-end and ETF assets.
RBC GAM and BMO Global Asset Management held steady market share year-over-year, while TD Asset Management, Scotia Global Asset Management, and CIBC Global Asset Management each gained one percentage point.
Despite that dominance, the concentration is softening at the edges. The top 10 firms now command 73 per cent of fund industry AUM among Canada's largest 50 fund families, up from 69 per cent a year earlier but that growth is partly explained by global managers closing the gap. Fidelity International and BlackRock each increased their market share by one percentage point over the past year, driven largely by ETF demand.
RBC GAM carries an Above Average Morningstar Parent Pillar rating (the rating Morningstar analysts assign to assess how well an asset manager stewards capital on behalf of investors) following what the report describes as a smooth leadership transition.
Global CIO Dan Chornous retired in January 2026 after 45 years with the firm; he was succeeded by Stu Kedwell, who spent most of his 30-year career at RBC GAM and had most recently served as global head of equities. More than 80 per cent of the firm's share classes are priced at or below category averages, according to Morningstar.
ETFs reshape the competitive landscape
The sharpest competitive gains in 2026 belong to firms built on ETFs from the ground up.
BlackRock's iShares business leads all 10 largest Canadian fund firms on Morningstar Medalist Ratings (the forward-looking ratings that measure a strategy's expected risk-adjusted performance net of fees) with 76 per cent of its share classes earning a Gold, Silver, or Bronze rating. The average among Canada's largest 50 firms is just 34 per cent, according to Morningstar.
BlackRock manages four of the 10 largest Canadian ETFs by assets, including the iShares Core S&P/TSX Capped Composite ETF, the largest passive Canadian equity ETF, and the iShares Core Equity ETF, a CAD 20 billion all-in-one asset-allocation product that has become one of the country's most popular investment vehicles.
Vanguard, despite slipping to 13th in AUM rankings due to a 2026 methodology change that excluded Canada-domiciled wrappers of US ETFs, holds a High Parent rating and continues to attract substantial inflows.
The firm's Vanguard S&P 500 ETF remains the single largest Canadian ETF at CAD 35 billion in assets — though it holds units of the US-domiciled version and is excluded from net asset figures under the new methodology.
The shift toward ETFs in Canada has been building for years, but the speed of the transition in 2026 has caught some incumbents flat-footed.
CI Global Asset Management, which manages approximately CAD 180 billion, earned a Parent rating upgrade to Average from Below Average as its reorganisation under president and CIO Marc-André Lewis stabilised. The firm's history of acquisition-led ETF expansion, including the purchase of Invesco's Canadian mutual fund and ETF assets in 2026, reflects the industry's broader buy-build-partner dynamic.
CI acquired alternative asset manager Forge First in 2025 and is now majority-owned by sovereign-affiliate Mubadala Capital, which Morningstar suggests could provide a more stable backdrop for long-term initiatives.
Only four firms earn Morningstar's highest stewardship grade
Of the 24 firms covered by Morningstar analysts in the report, only four earned the top High Parent rating: Vanguard, Dimensional Fund Advisors, Pimco, and Capital Group, parent of American Funds. Morningstar noted that J.P. Morgan Asset Management also holds a High rating but falls outside the top 50 by Canadian fund AUM.
Pimco received a rating upgrade in 2026 (to High from Above Average) the most notable change in the report's stewardship assessments. Morningstar cited the firm's depth of fixed-income talent and its ability to maintain strong results across a concentrated lineup anchored by the CAD 33.6 billion PIMCO Monthly Income Fund (Canada), one of the largest funds of any type in the Canadian market.
Fee competition among Canadian fund managers intensified over the past year. In November 2025, Vanguard reduced management fees on its all-in-one asset-allocation ETF suite to 17 basis points from 22 basis points.
BlackRock matched that level the following month. Those two suites collectively account for approximately seven per cent of Canadian ETF assets, according to Morningstar, making the reductions meaningful for a broad swath of Canadian investors.
Boutiques punch above their weight on stewardship
Canada's investment boutiques are consistently outperforming larger peers on manager tenure - a key factor in Morningstar's Parent assessment. Beutel Goodman, an employee-owned Toronto-based value manager, leads all firms on average fund tenure for its longest-named managers at 18 years. EdgePoint Investment Group and Mawer Investment Management, both majority employee-owned, also rank in the top 10 on tenure metrics.
Mawer, a Calgary-based boutique that manages more than CAD 84 billion in assets, was downgraded from High to Above Average in 2026 following significant underperformance in its flagship Mawer Global Equity strategy and subsequent management changes.
Industry veteran Bruce Geddes joined the firm in July 2025 as its first dedicated chief executive, a structural separation Morningstar views as a positive signal for the firm's long-term governance.
Canada's fund market remains heavily weighted toward active management, with actively managed strategies representing 80 per cent of net fund assets; a higher proportion than in the United States, Europe, or Japan, according to Morningstar.
Liquid alternatives, meanwhile, remain a niche segment: just 11 of the 50 largest fund families derive 10 per cent or more of total assets from alternative strategies, with Picton Mahoney Asset Management the most concentrated at 84 per cent.
