It’s fair to say that 2017 was a blockbuster year for the Canadian ETF market. Records were smashed and new products launched at a rate never seen before (in September alone, 30 new ETF products were launched in the Canadian market).
The growth has been nothing short of astounding and there are now 25 ETF providers in Canada. In fact, all of the traditional mutual fund companies now have some presence in the ETF space.
It may come as little surprise to some, then, that the business of Canada’s biggest ETF provider by AUM - BlackRock Inc.’s iShares - expanded at its fastest pace ever in 2017. The growth was driven by an increased interest from investors from all corners of the market, including traditional core foundational funds and more targeted fund exposures that provided new ways to access specific markets.
“We project the global ETF market to more than double in assets under management by 2022,” said Mark Wiedman, Global Head of iShares and Index Investments at BlackRock. “Three global trends should power this growth: fee-based wealth management, networked bond and derivatives trading, and alpha-seeking usage by active fund and wealth managers.”
As institutional investors upped their ETF usage, iShares saw a record of US$246 billion in new flows, taking the global ETF industry beyond $4.5 trillion in total AUM for the first time. In Canada, iShares Canada’s Core funds reached CAD$18.7 billion in assets under management, growing at 22.6% organically, adding a record CAD$3.5 billion in net in-flows. XIC – iShares’ broad Canadian equity fund –generated CAD$1.2 billion in net inflows last year.
Globally, iShares AUM closed the year at an astronomical US$1.754 trillion, including US$1.33 trillion in equities and US$427 billion in fixed income and commodities. The success is truly global and, looking further into 2018, the Canadian market remains an area of focus for BlackRock to continue growing its ETF business.
“We’re continuing to experience growth across our platform, including our popular core suite of funds and our new and innovative strategic fixed income suite of funds,” said Pat Chiefalo, Head of iShares Canada at BlackRock.
“At the same time, we’re proactively evolving how we interact with clients. By leveraging a solutions-oriented approach, and using tools like portfolio analytics and portfolio consulting services, to help our clients reach their investment goals, we’re solidifying our position as a trusted partner to investors all across Canada.”
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