Canadian fund investors still aren't completely sold on equities. In fact, more people are selling stock funds than those who are buying.
In November, net sales of equity funds reached about $320-million, according to the Investment Funds Institute of Canada, which means that much more was cashed out of these funds than was placed in them. Bond funds, however, had net inflows of about $1.1-billion.
Flows to fixed-income funds have dominated most of 2010 because investors have been so nervous about economic growth prospects, especially after the European debt crisis exploded this past spring. But the Toronto Stock Exchange is up 12 per cent since Sept. 1, and you would think investors would want to cash in on the rally.
However, it isn't fair to say that no one is buying funds with equity components. Balanced funds are on fire, with net inflows of around $3-billion in November.
So far this year, equity fund sales are at a net loss of $6.2-billion, while balanced funds have a net gain of $24-billion and bond funds have a net gain of almost $10-billion.
Tim Kiladze