Category: News

Highlights from Q1 2023

• In the first quarter of 2023, one-half (50%) of RI funds outperformed the average return for their respective asset class category. This proportion is consistent with last quarter.
• Net asset flows to Canadian-domiciled RI funds in the first quarter of 2023 remained positive at $1.4 billion CAD. This was a 109% increase from the previous quarter.
• This quarter, 5 new RI products were launched, of which 3 are ETFs and 2 are Mutual Funds. In all of 2022, 45 new RI products were launched.

RI Fund Performance

• Based on data provided by Morningstar, in Q1 2023 50% of Canadian-domiciled RI funds (including mutual funds and ETFs) outperformed the average return for their respective asset class. For the 12 months ending March 31st 2023, 34% of Canadian RI funds outperformed their respective average asset class return.
• Over the medium term, 31% of Canadian-domiciled RI funds outperformed the average return for their respective asset class over the 3 years ending March 31st, 2023, as did 34% over the 5-year period.
• The following information highlights RI fund performance for select asset classes, in Q1 2023 and over longer time periods.

Canadian Equity

For the Canadian Equity fund class, 74% of RI Canadian Equity funds outperformed the average for the asset class in the first quarter of 2023. This quarter, the average RI fund return exceeded the average return for the asset class. For all other time periods examined in this report, the average RI fund moderately underperformed its asset class counterpart.

Canadian Fixed Income

For the Canadian Fixed Income fund class, in the first quarter of 2023, 57% of RI funds outperformed the average asset return for the category, and the average RI fund outperformed the category average. Over the 1, 3, 5, and 10 year periods reviewed in this report, the average RI fund slightly underperformed the category average.

International Equity

For the International Equity fund class, 95% of RI funds outperformed the average asset class return in the first quarter of 2023. For the quarter and 12 months ending March 31st 2023, the average RI International Equity fund outperformed the average for the asset class. For all other time periods observed, the average RI fund underperformed the asset class average.

US Equity

For the US Equity fund class, 84% of RI funds outperformed the average asset class return in the first quarter. This quarter, the average return for RI US Equity funds outperformed the average return of the asset class. For the previous 1 and 3 year periods, the average RI fund underperformed the asset class average.

Note: For the purpose of this report, RI funds include those that are marketed as responsible investments with RI strategies/policies disclosed in regulatory documents. Average asset class return includes RI and non-RI funds. Returns for periods greater than one year are annualized. Excludes fund-of-funds.

RI Fund Flows

Net asset flows into RI mutual funds and ETFs were positive this quarter at approximately $1.4 billion, a significant increase from the fourth quarter of 2022 which had net asset flows of $660 million. Both passive and active strategies had positive inflows this quarter, with active strategies representing about 93% of the total inflows.

Canadian RI Mutual Fund and RI ETF Net Flows

Source: Morningstar Direct. Data as of March 31st, 2023. Excludes funds of funds.

RI Product Launches

Based on information from Morningstar, RI product launches increased from the previous quarter. In Q1 2023, 5 new products were launched. In the previous quarter, only 1 new product was launched, which was a mutual fund. For the calendar year 2022, a total of 45 RI products were launched.

Canadian RI Mutual Fund and RI ETF Launches

Source: Morningstar Direct. Data as of March 31st, 2023.

CIFSC Responsible Investment Identification Framework

The Canadian Investment Funds Standards Committee (CIFSC) originated in 1998 with the intention of standardizing the classification of Canadian-domiciled mutual funds. In recognition of the growing appetite for responsible investment (RI) products and subsequent standardization needs, in January 2023 CIFSC formally published its Responsible Investment Identification Framework and initial list of identified RI products.

The CIFSC RI identification framework was developed in collaboration with various stakeholders, including research firms, data providers, asset managers, and other industry bodies. The objective of the RI classifications is to guide Canadian investors to find RI products that indicate they are following a responsible investment approach, according to their regulatory documents. The CIFSC classifications are meant to be used in conjunction with and are complementary to the Canadian Securities Administrators’ (CSA) guidance on ESG-related fund disclosures (CSA Staff Notice 81-334) as well as the CFA Institute’s Global ESG Disclosure Standards for Investment Products. The CIFSC RI framework may change as the RI landscape evolves.

The CIFSC RI product classifications have been incorporated into the file that accompanies this writeup, as a new feature to this quarterly reporting.

 

Download Q1 2023 Highlights PDF.

RIA Members can download the full report by logging in to their account and accessing Member Resources.

 

Data provided by

©2023 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

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Disclosure
The information contained in this report is for educational and general information purposes only. The information contained herein does not constitute advice nor does it constitute an offering of securities or any advertisement for the offering of securities. You should not act or rely on the information without seeking professional advice. While we believe the information to be reliable [and endeavour to keep the information up to date and correct], we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, timeliness, suitability or availability with respect to the report or the information, products, services or related graphics contained in the report for any purpose. The RIA does not endorse, recommend or guarantee any investment products listed in the report.

Climate Engagement Canada’s Net Zero Benchmark will assess Canadian corporate issuers on their progress against climate goals, driving alignment with the Paris agreement.

TORONTO | Traditional territories of the Mississaugas of the Credit, the Anishinaabeg, the Haudenosaunee, and the Huron-Wendat – Climate Engagement Canada (CEC), an investor-led collaborative engagement initiative, has announced its Net Zero Benchmark Criteria. The Benchmark will serve as a tool to support the “Just Transition” among Canada’s corporate issuers towards a Net Zero economy by standardizing expectations from the financial community.

The CEC Net Zero Benchmark provides a set of common standards for investors to evaluate corporate issuers’ progress towards aligning with the Paris Agreement’s ambition: limiting global warming to well below 2 degrees Celsius, while pursuing efforts to limit the increase to 1.5 degrees. The Benchmark allows CEC Participant Investors to frame, and soon measure, their engagements with Canada’s top emitters, inclusive of corporate issuers. With this framework in place, Participant Investors can identify areas for discussion with CEC Focus List companies and identify areas for additional improvement in their Net Zero transition.

“With the Net Zero Benchmark, CEC continues to push the standard for collaborative stakeholder engagement. The Benchmark will provide participating investors with a collective view of key engagement developments and themes in the Canadian context, which helps inform focused and consistent dialogue between Canadian companies and investors,” said Barbara Zvan, President & CEO, UPP, and CEC Steering Committee Chair. “It is a much-needed tool along the path towards a Net Zero economy.”

“Think of this as the Google Maps for the Canadian climate transition,” said Kevin Thomas, CEO of SHARE. “Rigorously tracking our collective progress along this route is how we make sure we all get to our destination. It keeps us honest and it keeps us effective.”

“The current climate trajectory presents a systemic risk to investment portfolios and long-term returns to pension fund beneficiaries. Investors are intensifying their engagement with companies, calling for near-term action from the companies they are invested in,” said Karen Lockridge, Director of ESG Investing at Canada Post Pension Plan, and CEC Technical Committee Chair. “The CEC Net Zero Benchmark will be a valuable tool for companies to understand investor expectations. It guides transparency around credible net zero emissions strategies and can support constructive dialogue between companies and investors.”

“The CEC Net Zero Benchmark is a crucial step on the path towards a Net Zero economy in Canada, providing corporate issuers with a clear and consistent framework to identify opportunities for climate action,” said Patricia Fletcher, CEO of Canada’s Responsible Investment Association. “The Benchmark will underpin the conversations between investors and large corporate emitters as they work to measure and advance decarbonization across key sectors in Canada’s economy.”

“As a founding signatory to the CEC initiative and fiduciaries of our clients’ assets, RBC Global Asset Management recognizes the importance of the global goal of achieving net-zero emissions by 2050 or sooner in order to mitigate climate-related risks,” said Maia Becker, Senior Director, Corporate Governance and Responsible Investment, RBC Global Asset Management, and CEC Technical Committee Vice Chair. “We believe the CEC Net Zero Benchmark will be an important tool for investors to advance dialogue and develop a consistent framework when engaging with Canadian corporate issuers on the actions they are taking to address climate change.”

The CEC Net Zero Benchmark is closely aligned with the Benchmark developed by Climate Action 100+, the current global standard for collaborative shareholder engagement. The CEC Net Zero Benchmark follows this example whilst layering in additional context specific to Canada’s unique economy, developed with the expertise of the CEC Technical Committee and SHARE. It was further refined by incorporating feedback from a public consultation period, which involved CEC Participant Investors—including some of Canada’s largest asset managers and asset owners—NGOs, and Indigenous representation.

In the fall, investors can expect to see evaluations of all CEC Focus List companies based on the CEC Net Zero Benchmark, highlighting areas of strength and areas for further improvement. This will help define objectives for future climate engagements.

About Climate Engagement Canada (CEC)

Climate Engagement Canada (CEC) is a finance-led initiative that drives dialogue between the financial community and corporate issuers to promote a just transition to a Net Zero economy – to the benefit of investors, companies, employees, and consumers. CEC is coordinated by its Joint Secretariat: the Responsible Investment Association (RIA) and the Shareholder Association for Research and Education (SHARE). The initiative is also supported by international investor networks, the UN Principles for Responsible Investment (UNPRI) and Ceres.

Congratulations to Canada’s newest recipients of the RIA’s financial credentials in recognition of expertise in responsible investing. View a full list of RIA credential holders here.

Learn more about the RIA’s training and credentials here.

Wilford Ang (RIS), Credential Asset Management
Geneviève Chayer (RIS), Services Financiers Geneviève Chayer
Yanhao Chen (RIS), Desjardins
Nicolas Dessureault (RIS), Desjardins
Derek Dibattista (RIS), Libro Credit Union
Marlene A Goosen (RIS), FirstOntario Insurance
Lindy Homenick (RIS), Prospera Credit Union
Aylene Joseph (RIS), Investia Financial Services Inc.
Joshua Kwok Wai chu (RIS), Vancity Credit Union
Karine Labelle (RIS), Services Financiers Karine Labelle inc.
Rénald Lacroix (RIS), Assur-Ray
David Lavoie (RIS), IG Gestion de Patrimoine
Sandra Lena Dauvin (RIS), Synergy Credit Union
Jaclyn Liu (RIS), Mackenzie Investments
Lynn MacCallum (RIS), ConnectFirst Wealth
Rebecca Maillot (RIS), Interior Savings Credit Union
Nathan Marchand-Bourgeois (RIS), GFM
Crystal Pazitka-Perry (RIS), Libro Credit Union
Shahin Sasanfar (RIS), Meridian Credit Union
Francis Soucy (RIS), Desjardins Securities

Congratulations to Canada’s newest recipients of the RIA’s financial credentials in recognition of expertise in responsible investing. View a full list of RIA credential holders here.

Learn more about the RIA’s training and credentials here.

Amilio Edley Acampora (RIS), Libro Credit Union / Credential Asset Management
Gurjeet Baler (RIS), Servus Credit Union
Benjamin Baxter (RIS), Himmelman & Associates Financial Advisors
Brittany Burling (RIS), Libro Credit Union
Jeremy Chisholm (RIS), Vancity Credit Union
William Cook (RIAC)
Muirgheal Despina Bascia (RIAC)
William Elliott (RIS), Vancity
Ian Gutri (RIS), Kindred Credit Union
Melissa Horlor (RIS), Libro Credit Union
Sean Garrett Jeffery (RIS), Interior Savings Credit Union / Credential Asset Management
Mohamed Jelassi (RIS), Desjardins Sécurité Financière
Mohamed Jelassi
Jacob Lamanna (RIS), Desjardins
Erik Lapierre (RIS), Desjardins
Jacques Lepine (RIS), Desjardins
Heather Livingston (RIS), Credential Asset Management
Mohammed MAZ (RIS), Placements NEI
Joseph (RIPC) (RIS), IG Wealth Management
Jiesheng Nie (RIS), CIBC
Melissa Nolan (RIS), Libro Credit Union
Jonathan Parpatt (RIS), Worldsource Financial Management
Matthew Pietrangelo (RIS), Meridian Credit Union
Sheldon Rice (RIS), Raymond James Ltd
Chris Richardson (RIS), Kindred Credit Union
Jessica Rivera Rodriguez (RIS), Cambrian
Sofia Sargsyan (RIS), IA Clarington
David Joseph Sigrist (RIS), Prospera Credit Union
Parker Smith (RIS), Credential Asset Management/ Libro Credit Union
Linden Thibault (RIS), Prospera Credit Union
Chelsea Vanceeder (RIS), Credential Securities
Sara Vancoillie (RIS), Libro Credit Union
Aaron Wybrow (RIS), Libro Credit Union

Congratulations to Canada’s newest recipients of the RIA’s financial credentials in recognition of expertise in responsible investing. View a full list of RIA credential holders here.

Learn more about the RIA’s training and credentials here.

Kabir Ahmed (RIS), PenFinancial Credit Union
Ana Milena Arango Patino (RIS), Desjardins
Laurianne Dionne Arseneault (RIS), IA groupe financier
Christien Cormier (RIS), UNI coopération financière
Donald Cornack (RIS), IG Wealth Management
RACHEL DAIGLE (RIS), UNI
Gwen Davidson (RIS), RCU Insurance Services
Jeff Elliott (RIS), TCU Wealth Management
Martin Gendron (RIPC)
Frédéric Girard Girard (RIS), Desjardins
Joan Lahondes (RIS), Desjardins
Patrick Lavoie (RIAC)
François Leroux (RIPC)
Morgan Leroy (RIPC)
Derek Levesque (RIAC)
Christiane Masson (RIS), Caisse de l’Administration et des Services Publics
Marie-Ève Mc Lean (RIS), Proactif services financiers
Ricardo Moullas (RIS), BMO Global Asset Management
Huy Phuong (Phil) Nguyen (RIS), Prairie Centre Credit Union
Harrison Nnebe (RIS), Vancity Credit Union
Hamon Philippe (RIS), AVISO
Carole Saumier (RIS), Caisse Desjardins de l’Administration et des Services publics
Benoit Therrien (RIAC)
David Vachon (RIS), Desjardins
Fang Wang (RIS), Desjardins
Megan Wenckowski (RIS), Harvest Wealth Management

Congratulations to Canada’s newest recipients of the RIA’s financial credentials in recognition of expertise in responsible investing.

Learn more about the RIA’s training and credentials here.

Clara Benjamin (RIS), Prairie Centre Credit Union
Paul Bowolin (RIS), Nelson Family Financial Services
Jennifer Broad (RIS), CUSO Wealth Strategies Inc
Myriam Busque (RIS), Caisse Desjardins de l’Administration et des Services
Jason Charchar (RIS), Meridian Credit Union
Tao Chen (RIS), AI Financial
Yuchuan Cheng (RIS), AI Financial
Michael Chumakov (RIS), Alterna Savings and Credit Union
Teresa Cutting (RIS), IG Wealth Management
Yannick Decosse (RIS), IG Wealth Management
Xiaoyi Deng (RIS), AI Financial
Khush Dhaliwal (RIS), Tandia Financial Credit Union
Audrey Dubois (RIS), Desjardins caisse des Bois-Francs
Derek Duchesne (RIS), National Bank Financial
Bronson Fridal (RIS), Desjardins
Albertine Girard (RIS), Desjardins
Guylaine Guillemette (RIS), Caisse Desjardins De L’Administration et des Services Publics
Lyne Marie Guitard (RIS), UNI Cooperation Financière
Shu-Hua Ho (RIS), Ai Financial
YI HUA LU (RIS), AI Financial Power Group
Hsiu-Chu Ivory Hsieh (RIS), AI Financial
Faiza Kabissi (RIPC)
Weiqing KANG (RIS), AI financial
Graeme Kaye (RIS), Island Savings, a Division of First West Credit Union
Jessica Kohlhauser (RIS), Synergy Credit Union
Stephanie Koleszar (RIS), Capital Group
Maxime Lafleur (RIS), Caisse d’économie solidaire Desjardins
Emilou Laplante (RIS), Prairie Centre Credit Union/Credential Asset Management
Lisa Leblanc (RIS), Investia Financial
Guohua Liu (RIS), AI Financial
Jun Lu (RIS), AI Financial Power Group
Alexandre Mathieu MAHÉ (RIS), Desjardins
Christiane Masson (RIS), Caisse de l’Administration et des Services Publics
Paul Moffatt (RIS), IG Wealth Management
Tim Nash (RIS), Good Investing
Sarah Nimmo (RIS), Integris Credit Union
Arlene Pelley (RIS), The Co-operators
Louis Savoie (RIS), Credential Asset Management
Chuanli Shi (RIS), AI Financial
Jasleen Sidhu (RIS), Steinbach Credit Union
Erika Stewart (RIS), CH Financial Ltd.
Shaoling Su (RIS), AI Financial
Tao Wang (RIS), AI Financial
Deborah Williams (RIS), DFSIN
Angela Wittmann (RIAC)
Jacky Xi Feng (RIS), Ai Financial Power Group
Noémie Xin Savard (RIS), Desjadins
Jie Xing (RIS), AI Financial
Kylie Young (RIS), Swan Valley Credit Union
Shimin Zhou (RIS), AI Financial

Highlights from Q4 2022

• In the fourth quarter of 2022, one-half (49%) of RI funds outperformed the average return for their respective asset class category. Last quarter, this proportion was about 60%.
• Net asset flows to Canadian-domiciled RI funds in the fourth quarter of 2022 remained positive at $660 million. This was a 164% increase from the previous quarter.
• This quarter, only 1 new RI product was launched, which was a mutual fund. Year-to-date 2022, 45 new RI products have been launched.

RI Fund Performance

• Based on data provided by Morningstar, in Q4 2022 49% of Canadian-domiciled RI products outperformed the average return for their respective asset class. For the 12 months ending December 31st, 2022, just 21% of Canadian RI products outperformed their respective average asset class return.
• Over the medium term, 42% of Canadian-domiciled RI products outperformed the average return for their respective asset class over the 3 years ending December 31st, 2022, as did 42% over the 5-year period.
• The following information highlights RI fund performance for notable asset classes, in Q4 2022 and over longer time periods.

Canadian Fixed Income

For the Canadian Fixed Income fund class, 54% of RI Canadian Fixed Income products outperformed the average for the asset class in the fourth quarter of 2022. This quarter, the average RI product slightly underperformed the average for the asset class. For all other time periods examined in this report, the average RI product outperformed its asset class counterpart.

Global Fixed Income

For the Global Fixed Income fund class, in the fourth quarter of 2022, 57% of RI funds outperformed the average asset return for the category. For the 12 months ending December 31st, 2022, the average RI fund outperformed the category average. Over the 3, 5, and 10 year periods reviewed in this report, the average RI fund just slightly underperformed the category average.

US Equity

For the US Equity fund class, 69% of RI funds outperformed the average asset class return in the fourth quarter. For the previous 1, 3, and 5 years the average RI product outperformed the asset class average, and for the previous 10 years the average RI product just slightly underperformed the asset class average.

Note: For the purpose of this report, RI funds include those that are marketed as responsible investments with RI strategies/policies disclosed in regulatory documents. Average asset class return includes RI and non-RI funds. Returns for periods greater than one year are annualized. Excludes fund-of-funds.

RI Fund Flows

Net asset flows into RI mutual funds and ETFs were positive this quarter at approximately $660 million, a significant increase from the third quarter net assets flows of $250 million. Both passive and active strategies had positive inflows in the fourth quarter, with active strategies representing about 90% of the total inflows. For the full year, net asset flows into RI funds totaled $5.1 billion, compared to $12.8 billion in all of 2021.

Canadian RI Mutual Fund and RI ETF Net Flows

Majority of investors surveyed believe companies in their portfolios need to commit to preventing the loss of biodiversity in the way they conduct their business.

TORONTO – January 24, 2023 – The vast majority of Canadian retail investors are concerned about biodiversity loss and want to see biodiversity protection reflected in their portfolios, according to a new survey from the Responsible Investment Association (RIA).

The 2022 RIA Investor Opinion Survey, which is based on an Ipsos poll of 1,005 individual investors in Canada, found that 74% of respondents are concerned about biodiversity loss, with 68% agreeing that it was important for companies in their portfolios to commit to preventing biodiversity loss.

Investors’ concern about greenwashing remained steady at 75%, similar to what was expressed in 2021. In a year characterized by greenwashing headlines, 78% of respondents agreed that there needs to be increased scrutiny in the investment industry around greenwashing. Despite these concerns, 76% of respondents agreed that RI can have a real impact on the economy and contribute to positive change for society.

The survey, sponsored by AGF Investments Inc. and Desjardins Group, also shows that 73% of respondents want their financial services provider to inform them about responsible investments (RI) that are aligned with their values, while only 31% said they had ever been asked if they were interested. About one-third of respondents said they currently own responsible investments, similar to the last 3 years.

“It’s clear that investors are thinking about social and environmental issues and want their portfolios to reflect their concerns,” said Patricia Fletcher, CEO of the RIA. “This is an opportunity for financial advisors that are knowledgeable about responsible investing to meet investor demand and provide investment opportunities that align with their clients’ ESG preferences and personal values.”

“We are pleased to support the 2022 RIA Investor Opinion Survey,” said Eric Landry, Vice-President, Investment Solutions at Desjardins Investments. “It’s a valuable tool that confirms the importance of focusing our efforts on advisor education and greenwashing prevention.”

“We are proud to once again sponsor a survey that inspires dialogue about RI, while covering timely topics like biodiversity and greenwashing,” said Judy Goldring, President and Head of Global Distribution at AGF Management Limited. “We are encouraged by the ongoing interest in responsible investing and are committed to ensuring the advisors we work with have the resources they need to engage in informed discussions with their clients.”

Additional Highlights:

• Most respondents are interested in RI, with 64% expressing interest. Younger respondents generally are more interested than those aged 55+, while female respondents are more interested than their male counterparts.
• 70% of respondents know little or nothing about RI, including one-quarter that have never heard of it. Levels of RI knowledge have flattened off in the past 2 years.
• Looking ahead, 40% of respondents said they were now more likely to choose RI than one year ago, while 44% said they were neither more nor less likely than one year ago.
• The topic of biodiversity loss resonated with respondents. The majority of respondents were concerned about biodiversity loss, with 74% saying they were either very or somewhat concerned. Additionally, 68% of respondents agreed that it was either very or somewhat important that companies are committed to preventing biodiversity loss.
• Investors are concerned about greenwashing in the investment industry. 75% of respondents said they were either very or somewhat concerned about greenwashing, similar to the level expressed in 2021. Meanwhile, 78% of respondents either strongly or somewhat agreed that there needs to be increased regulation and scrutiny in the investment industry to combat greenwashing.

View the full report here.

About the RIA Investor Opinion Survey
The RIA publishes the RIA Investor Opinion Survey annually to track individual investors’ perspectives on responsible investment and various environmental, social, and governance (ESG) issues. The 2022 Survey is based on data collected by Ipsos from 1,005 Canadian individual investors between November 2nd and November 8^th, 2022. Investors are defined as individuals who currently own investments such as mutual funds, exchange-traded funds, stocks, bonds, or other securities. The poll has a Bayesian credibility interval of ±3.5%.

About the Responsible Investment Association (RIA)
The RIA is Canada’s industry association for responsible investment. The RIA’s membership includes asset managers, asset owners, advisors, and service providers who support its mandate of promoting responsible investment in Canada’s retail and institutional markets. RIA institutional members collectively manage more than $42 trillion in assets. Learn more at www.riacanada.ca.

Media Contacts
Nick Buccheri
Director, Operations
Responsible Investment Association
+1 416-461-6042

Highlights from Q3 2022

• The third quarter of 2022 saw significant improvement in overall responsible investment (RI) funds’ performance relative to the fund universe, compared to the second quarter. The majority (60%) of RI funds outperformed the average return for their respective asset class category in the third quarter. Last quarter, this proportion was only about 25%.
• Net asset flows to Canadian-domiciled RI funds in the third quarter of 2022 remained positive at CAD 243 million. However, this was an 85% decline from the previous quarter.
• This quarter, 5 new RI financial products were launched, all of which were mutual funds. Year-to-date 2022, 44 new RI products have been launched.

RI Fund Performance

• Based on data provided by Morningstar, in Q3 2022 60% of Canadian-domiciled RI products outperformed the average return for their respective asset class. For the 12 months ending September 30, 2022, just 33% of Canadian RI products outperformed their respective average asset class return.
• Over the medium term, 46% of Canadian-domiciled RI products outperformed the average return for their respective asset class over the 3 years ending September 30, 2022, and 52% over the 5-year period.
• The following information highlights RI fund performance for notable asset classes, in Q3 2022 and over longer time periods.

Canadian Equity

For the Canadian Equity fund class, in the third quarter of 2022, 88% of RI funds outperformed the average asset return for the category. For the 12 months ending September 30, 2022, the average RI fund underperformed the category average. Over the longer periods reviewed in this report, the majority of RI funds outperformed the category average.

Canadian Fixed Income

For the Canadian Fixed Income fund class, 59% of RI Canadian Fixed Income products outperformed the average for the asset class in the third quarter of 2022. The average RI product outperformed its asset class average counterpart for all previous time periods examined in this report.

US Equity

For the US Equity fund class, 64% of RI funds outperformed the average asset class return in the third quarter. 63% outperformed over the 12 month period, 40% over 3 years, 83% over 5 years, 38% over 10 years and 67% over 15 years.

Note: For the purpose of this report, RI funds include those that are marketed as responsible investments with RI strategies/policies disclosed in regulatory documents. Average asset class return includes RI and non-RI funds. Returns for periods greater than one year are annualized. Excludes fund-of-funds.

RI Fund Flows

Net asset flows into RI mutual funds and ETFs were positive this quarter at approximately CAD 243 million. This represents a significant drop from the second quarter, and the lowest level over the past two years. All of the inflows were towards active strategies at CAD 278.2 million, while passive strategies had outflows of CAD 34.4 million.

Canadian RI Mutual Fund and RI ETF Net Flows

Source: Morningstar Direct. Data as of September 30, 2022. Excludes funds of funds.

RI Product Launches

Based on information from Morningstar, RI product launches slowed down significantly from the previous quarter. In Q3 2022, only 5 new products were launched, all of which were mutual funds. Year-to-date in 2022, 44 new RI products have been launched.

Canadian RI Mutual Fund and RI ETF Launches

Source: Morningstar Direct. Data as of September 30, 2022.

 

Download Q3 2022 Highlights PDF.

RIA Members can download the full report by logging in to their account and accessing Member Resources.

 

Data provided by

©2022 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

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Disclosure
The information contained in this report is for educational and general information purposes only. The information contained herein does not constitute advice nor does it constitute an offering of securities or any advertisement for the offering of securities. You should not act or rely on the information without seeking professional advice. While we believe the information to be reliable [and endeavour to keep the information up to date and correct], we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, timeliness, suitability or availability with respect to the report or the information, products, services or related graphics contained in the report for any purpose. The RIA does not endorse, recommend or guarantee any investment products listed in the report.

Congratulations to Canada’s newest recipients of the RIA’s financial credentials in recognition of expertise in responsible investing.

Learn more about the RIA’s training and credentials here.

Inthu Aseerwatham (RIS), Alterna Savings Credit Union
Francis Bédard (RIAC)
Caroline Bouchard (RIS), VMD
Wahib Boutaleb (RIS), Fidelity Investments Canada
Jérôme Carrier (RIS), Desjardins
Yuanyuan Chai (RIS), AI Financial
Charles-Étienne Dagenais (RIAC)
David Dalton (RIS), Coastal Community Credit Union
Robyn Doyle (RIS), Meridian Credit Union
Mariz Fernando (RIS), Alterna Savings
Mike Heslop (RIS), Meridian Credit Union
Mitch Hutton (RIS), Gill & Schmall Agencies
Roselyn Jennison (RIS), Swan Valley Credit Union / Credential Asset Management
Lucas MacIntosh (RIS), MacIntosh Financial Group Ltd.
Jonathan JP Poisson (RIS), Desjardins
Louis Rodrigue (RIAC)
Louis Savoie (RIS), Credential Asset Management
scott syrja (RIS), IG Private Wealth Management
Karyn Tse (RIS)
Adam Van Every (RIS), WFCU
Summer Yang (RIPC)