He emphasized that ETFs are displacing traditional investment products across the board. “ETFs are not only replacing mutual funds in some cases…but also direct securities. We see ETFs gaining ground to pretty much everything that is in these channels, direct securities, direct bonds and so in many cases our assets are increasingly going toward ETFs in both channels.”
Growth has been especially pronounced in the self-directed investing space, where ETF assets surged more than 50% over the past year. In comparison, full-service brokerage ETF holdings increased by about 30% over the same period.
Cardone added that investment managers are increasingly expanding their ETF offerings to meet rising demand. “This is not a newer phenomenon. It’s something that has been developing over the last several years. It’s very global,” he said.
“We have seen the immersion of active strategies in ETFs several years ago, something that started actually in Canada for the most part and then became more of a global trend.”
Cardone’s insights follow a milestone year for ETFs in Canada. As reported by Bloomberg News in January, ETF assets topped $500 billion in 2023, with record-breaking inflows and an unprecedented number of new products entering the market.