Canadians flock to fixed income ETFs in ‘flight to safety’ amid economic worries

Canadian-listed exchange-traded funds recently crossed the $200-billion asset mark and record inflows are expected in 2019amid an increase in purchases of conservative fixed-income funds from retail investors seeking more safety.

Investors flocked to Canadian aggregate bond ETFs and foreign bond funds as well as"cash-alternative" ETFs. The move to these high-interest savings ETFs, in particular, represents a “flight to safety,” Mr. Straus says, as investors look to protect their capital amid fears of a global recession and to avoid more complex and potentially lower-yield bonds in today's uncertain interest-rate environment.

“These are one step away from sticking money into your mattress,” Mr. Noble says, noting that ETF choices in Canada are driven by financial advisers and direct investors with a “fearful mindset,” spooked by worries of an economic downturn.“Any new capital is being deployed very conservatively,” he says, even in equities where investors this year are into low-volatility products.

“It’s a great way to build a diversified portfolio with one product rather than having many small holdings," he says."We now have way better options than we did, but we need to convince people to use them.” Mr. Noble thinks the number of ETFs has reached its peak, believing there’s “too much product and too many providers for the size of the market in Canada.”

Canada Latest News, Canada Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Value ETFs to diversify growth-heavy portfoliosWith value investing in the midst of a resurgence, three experts provide six picks to take advantage of this ‘once in a decade trade’
Source: globeandmail - 🏆 5. / 92 Read more »

Posthaste: Wattpad & WestJet's Wexit worries highlight the real-life economic consequences of separation chatterStuff you need to know In the space of one term in office Trudeau has inspired a rejuvenation of Quebec separatism and Wexit His father would be proud The majority of Canadians not so much WestJet with their foreign CEO should just shut it. Blaming the people because they feel alienated? How about you blame the reason for the alienation?
Source: nationalpost - 🏆 10. / 80 Read more »

The most important Canadian economic charts to watch in 2020 - Macleans.caOur sixth annual chartapalooza includes more than 80 charts from the experts on jobs, GDP, real estate, trade plus so much more
Source: macleans - 🏆 19. / 71 Read more »

Value ETFs to diversify growth-heavy portfoliosWith value investing in the midst of a resurgence, three experts provide six picks to take advantage of this ‘once in a decade trade’
Source: globeandmail - 🏆 5. / 92 Read more »

Protests erupt as India pushes for religion-based citizenship billHome Minister Amit Shah introduced the Citizenship Amendment Bill in India’s lower house amid raucous debate That's discriminatory and possibly xenophobic India is setting up concentration camps that singles out Muslims. So far using a registry they have marked 2 million (mostly Muslim) as non-citizen. The non-muslim will be able to become naturalized while Muslims will be sent to prisons.
Source: globeandmail - 🏆 5. / 92 Read more »