Investors pour billions into US assets despite Canadian stocks posting stronger returns this year
Canadian investors are sending record amounts of capital into US markets this year, despite trade disputes, boycotts, and declining cross-border travel.
According to Bloomberg, Canadians have poured $124bn into US stocks in 2025, putting flows on track for the largest yearly inflow since at least the 1990s.
Fortune reported that between January and May alone, Canadian investors purchased $59.9bn in US debt and equities — the highest year-to-date tally in more than three decades.
Over the same period, net foreign investment in Canadian securities dropped by $18bn
This buying spree has come even as Canadian equities outpaced US performance.
Bloomberg data showed the S&P/TSX Composite Index climbed nearly 15 percent this year, compared with a 10 percent rise in the S&P 500 Index.
Morningstar figures cited by Fortune also confirmed Canadian stocks have led gains, partly due to lower starting valuations.
Yet, investors continue to look south.
Warren Lovely, managing director at National Bank of Canada Financial Markets, described the trend as “rather stunning.”
He wrote that Canadians “seemingly failed to employ a ‘buy Canadian’ (or ‘sell American’) philosophy in their own portfolio dealings,” even as US liquor was pulled from Canadian stores and tourism dwindled.
Much of the appeal has been driven by momentum in technology.
Greg Taylor, chief investment officer at PenderFund Capital Management, said in Bloomberg that “it’s a lot of performance chasing,” pointing to the rise of artificial intelligence and mega-cap tech stocks.
He added, “The US market is looking really crowded and stretched right now. The S&P/TSX Composite Index is looking like a nice setup for the next 12 months.”
Experts also note the structural limits of avoiding US exposure.
Brett House, professor at Columbia Business School and fellow with Canada’s Public Policy Forum, told Fortune that “Canada is a relatively small market, and any fully diversified approach to investing requires continued allocations to the US market.”
Moshe Lander, senior lecturer in economics at Concordia University, told Fortune that consumer boycotts and investment flows serve separate purposes.
He said, “The US boycott is an emotional thing, not an economic thing,” explaining that Canadians may choose not to buy American products, but financial advisors managing portfolios are not guided by emotion.
Meanwhile, the consumer pushback has shown measurable impact.
Fortune reported that US spirit sales in Canada dropped 66.3 percent between March and April, while Air Canada noted a 10 percent decline in bookings to US cities.
Bloomberg noted that Canada’s benchmark has recorded 30 highs this year, most recently on signs of trade de-escalation after Prime Minister Mark Carney said Canada would lift its retaliatory tariffs against the US.
