ETF flows slowed and turned defensive in April as investors moved away from equities and sought safety in fixed income funds, says National Bank Financial. Just more than $2 billion flowed into Canadian ETFs last month, down from nearly $7 billion in March. With investors around the world watching the developing banking crisis and the Fed’s reaction with a mix of flashbacks and consternation, “we have observed cautious and defensive ETF activity in Canada and the US,” the report says.
ETF flows slowed and turned defensive in April as investors moved away from equities and sought safety in fixed income funds, says National Bank Financial. Just more than $2 billion flowed into Canadian ETFs last month, down from nearly $7 billion in March. With investors around the world watching the developing banking crisis and the Fed’s reaction with a mix of flashbacks and consternation, “we have observed cautious and defensive ETF activity in Canada and the US,” the report says. That defensive activity was reflected in outflows of $836 from Canadian equity ETFs and $349 million from US equity funds. After pouring money into financial sector ETFs in March while the U.S. banking sector wobbled, investors were more cautious in April: financials saw outflows of $206 million last month. Almost $2 billion flowed into fixed-income funds in April, with more than half of that going to cash alternative funds. The other large category for inflows was Canadian government bonds, which gained $419 million, while high-yield and preferred-share funds saw outflows. Canadian ETFs have added $12.5 billion year to date, with $7.2 billion going to fixed income.
