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Canadian mutual fund sales down 1.6% in June, says IFIC

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Canadian mutual fund assets ended the second quarter of 2011, at CAD656.4 billion, down 1.6% from May, according to figures released by the IFIC. This is similar to the decline in June 2010, where assets declined 1.4% or CAD8.0 billion. However year
to date and year over year asset growth remain strong at 3.3% or 16.0% respectively.

Industry net sales in June totalled CAD1.27 billion, down from May 2011 (CAD2.07 billion) but significantly higher than June of last year (CAD224.9 million). Year to date, mutual fund net sales totalled CAD17.5 billion, over three times as much as for the same period in 2010 (CAD5.75billion).

Long-term funds net sales totaled CAD1.83 billion for the month, although down from May 2011 (CAD2.60 billion), slightly outpacing net sales in June of last year.

Money Market net redemptions, totaling CAD569.6 million, were generally in line with the previous month (May; -CAD529.2 million) but were significantly lower than that of June 2010 where the industry saw redemptions of -CAD1.19 billion.

Fund of funds meanwhile, continue to remain above the billion dollar mark with net sales of CAD1.57 billion. Long-term stand-alone funds had net sales of CAD269 million, lower than both the previous month and the previous year. Both year to date total stand-alone fund net sales and fund of fund net sales were stronger than for the same period last year at CAD4.56 billion, and CAD12.9 billion respectively in June 2011.

Balanced Fund net sales during the period continued to contribute the majority to industry net sales, totalling CAD2.22 billion in June 2011. Within the Balanced fund categories, the Global Balanced category net sales totalled CAD1.3 billion, although slightly lower than the previous month (CAD1.89 billion) just more than double that of June 2010 (CAD614.8 million).

Bond funds were the only broad asset class to experience a positive change in assets over the previous month, with assets growing by 0.3%. Bond fund net sales totalled CAD470.2 million in June 2011, higher than May (CAD176.4 million), and roughly the same as last June (CAD481.3 million). However, Bond funds net sales since the beginning of the year totalled CAD938.9 million – a significant drop over the same period last year where Bond funds net sales totalled CAD3.5 billion.

Equity fund net redemptions rose slightly in June to -CAD880.7 million, over the previous month. However, since the beginning of the year have remained relatively flat at -CAD6.30 million, and lower than for the same period last year (-CAD1.92 billion).

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