Canada’s ETF industry continues to expand rapidly, with assets surpassing $700 billion as investors and advisors increasingly rely on ETFs for portfolio construction. The growth reflects broader shifts toward fee-based advice, greater transparency and a wider range of active, passive and alternative strategies.
BNN Bloomberg spoke with Prerna Mathews, vice-president of ETF product strategy at Mackenzie Investments, about the evolution of ETFs in Canada, advisor compensation trends and where investors are finding new diversification opportunities.
Key Takeaways
- Canadian ETF assets topped $700 billion last year, rising nearly 38 per cent year over year and ranking among the fastest-growing ETF markets globally.
- ETFs are increasingly replacing traditional mutual funds as advisors shift toward fee-based portfolio management models.
- Active ETFs are no longer niche products, offering investors tools to pursue alpha alongside traditional index exposure.
- Greater regulatory focus on fee transparency is accelerating ETF adoption across the advice channel.
- Advisors are using ETFs to broaden diversification, including international equities, long-short strategies and Canadian resource exposure.
Read the full transcript below:
ANDREW: Time for the ETF report. According to Mackenzie Investments, Canada’s ETF market is one of the fastest-growing globally, with assets topping $700 billion last year, up nearly 38 per cent year over year. Let’s bring in Prerna Mathews, vice-president of ETF product strategy at Mackenzie Investments. Thanks very much. What trends jumped out for you last year? What was the big story?
PRERNA: Thank you for having me. And just to clarify, that $700 billion is in assets here in Canada alone. The ETF industry across the world is now north of $20 trillion. And as a reminder for everyone, ETFs were created right here in Canada 35 years ago. So we have seen a tremendous amount of growth in ETFs here in Canada, but certainly also globally.
Investors are voting with their dollars. They are choosing to invest through the ETF vehicle. ETFs are becoming more than just passive tools in portfolios. They offer transparency benefits, they are easy to trade and rebalance, and more products are available. More active ETFs are available and offered to investors. That makes it easier to manage a portfolio effectively if ETFs are the preferred vehicle.
ANDREW: Mackenzie has long been one of the big players in Canadian mutual funds, but you have found a way to have advisors work with ETFs. How does that work? Mutual funds traditionally carry commissions and trail fees. How are advisors compensated if they are getting investors to invest in ETFs?
PRERNA: Advisors have been evolving how they service clients, the value they offer and the tools they use to manage money. More advisors in Canada are choosing to use ETFs as part of how they deliver wealth management to clients.
We are increasingly seeing advisors move to fee-based models, where they are compensated at the overall portfolio level. Unlike the transaction-based or commission-based structures of the past, those models are increasingly going away. ETFs make it easier for advisors to manage portfolios, rebalance, redeploy as market conditions change and adjust allocations more efficiently.
ANDREW: That’s interesting, because the old mutual fund commission structure was so complicated. Do any ETFs pay trail fees? Is that a model in the industry?
PRERNA: They do not. ETFs are very transparent. You understand the fee you are paying. ETFs typically have a bid and an ask like a stock, since they trade on an exchange, and you transact at that market price. There are no additional embedded fees or expenses.
Most ETFs in Canada do not charge administrative fees, for example. That level of transparency is important, especially with increased regulation in the advice channel. Regulations such as CRM3 are driving greater clarity around fees and value for investors, which is contributing to increased ETF usage. ETFs have become very efficient portfolio management tools.
ANDREW: Can you give us a ballpark figure on how much Mackenzie has in ETFs? I don’t think you regularly disclose that.
PRERNA: Absolutely. We have just surpassed $25 billion on our ETF platform at Mackenzie, and we are just shy of our 10-year anniversary. That growth has been very exciting.
The advisors we work with are increasingly looking to ETFs, and as a long-standing Canadian asset manager with more than 58 years in the market, we want to continue serving clients in the way they prefer to manage money. ETFs are undoubtedly part of portfolio construction going forward.
ANDREW: One of your larger funds, at least on my Bloomberg screen, is the Mackenzie U.S. Large Cap Index ETF, ticker QUU. Bloomberg shows about $5 billion in assets. Is that among your largest products?
PRERNA: Yes, absolutely. Many advisors and investors may not realize that we are a comprehensive ETF provider in Canada. We have a long-standing legacy in active management, which we have brought to the ETF market through active ETFs.
We also have a robust passive or index ETF lineup, built for Canadian investors. We have several large passive ETFs on our platform that are used by individual, advisor and institutional investors.
ANDREW: What are your biggest ETF product categories right now? Where are advisors and retail investors allocating the most capital?
PRERNA: Given what we have seen over the past 12 to 18 months, the deglobalization narrative and the focus on diversification are top of mind for advisors and investors.
We are seeing increased interest in allocating outside North America, including international equity ETFs. There is also interest in seeking alpha opportunities in the U.S. market, where it is increasingly difficult to outperform the S&P 500, leading investors to consider long-short strategies and alpha extension ETFs.
Another area to highlight is the Canadian market itself. While Canadians tend to favour Canadian equities, many are underinvested in the resources sector. We are hearing this in macroeconomic commentary, and we believe the resources space presents an important opportunity. We have brought that exposure to market through our core resources ETF, which has seen growing interest from advisors and investors.
ANDREW: Prerna, thank you very much.
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This BNN Bloomberg summary and transcript of the Jan. 22, 2026 interview with Prerna Mathews are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
