Canadian ETFs opened the year with an unprecedented surge in inflows, defying typical seasonal patterns and reflecting broad-based demand across asset classes, regions and investor types.
BNN Bloomberg spoke with Valerie Grimba, director of global ETF strategy at RBC Capital Markets, about the forces behind the record-setting activity, shifting investor preferences and the areas drawing the strongest interest.
Key Takeaways
- Canadian ETFs attracted a record $27 billion in January, nearly doubling the previous monthly high and far exceeding typical seasonal inflows.
- Investor participation was unusually broad, with institutions, financial advisors and retail investors all contributing to strong demand.
- Emerging markets ETFs saw a sharp pickup as investors diversified globally and followed strong performance in several regions.
- All-in-one ETFs continued to gain traction as investors favoured simplified, diversified portfolio solutions.
- Canadian equity and mining-focused ETFs drew heavy inflows, supported by strong sector performance and growing international interest.
Read the full transcript below:
ANDREW: Time for the ETF report. Our guest says January was an extraordinary month for the ETF space, with nearly $30 billion pouring in across a variety of asset classes and geographies — $27 billion in inflows. We’re joined by Valerie Grimba, director of global ETF strategy at RBC Capital Markets. Great to see you. January was a strong month for stocks, and ETFs continued to absorb significant capital.
VALERIE: Thank you so much for having me, Andy. January was, once again, nothing short of absolutely incredible. At this point, I feel a bit like a broken record — ETFs are going amazingly well — but it’s important to contextualize that nearly $30 billion figure. It’s such a remarkable record.
Last year, the monthly run rate, which we thought was impressive at the time, was about $10 billion per month flowing into ETFs. To hit $27 billion in a single month is extraordinary. While January was generally a risk-on environment, there is still a lot of volatility, and macro conditions remain very uncertain.
January is also not typically a seasonally strong month for ETF inflows, which makes the performance even more impressive than the headline number alone. This was driven by multiple factors, but really it was everything firing on all cylinders — across asset classes, across geographies, and across investor segments.
In many months, ETF inflows are driven primarily by institutions putting on very specific exposures. In January, we saw participation from institutions, retail DIY investors and financial advisors. It was very broad-based interest. Another notable feature was breadth: more than two-thirds of all Canadian-listed ETFs saw inflows in January.
ANDREW: Just remind us — what does it mean when we say an ETF has inflows? What’s the mechanism behind that?
VALERIE: That’s a great question. When we talk about inflows, we’re referring to net new money going into an ETF. We can measure that by stripping out performance and isolating the actual dollar value flowing into the fund.
So, for all intents and purposes, this reflects buying interest — new capital coming into these ETFs.
ANDREW: I know you can’t get into all the mechanics, but an ETF isn’t quite like a regular stock. If I buy a U.S. equity index ETF in the market, am I not just buying it from another investor?
VALERIE: That’s correct — and that’s where ETFs differ. Stocks trade solely on the secondary market, and there is a finite number of shares available unless the company issues more.
In the ETF world, market makers — like RBC — can interact directly with the asset managers. That allows us to create new ETF units as demand comes in. That’s one of the key advantages of the ETF structure, and it’s also how we can measure buying interest through fund flows.
ETF flows give us a very clear picture of investor trends and where money is being allocated, and we can observe that on a daily basis. Especially during volatile periods, ETF flows provide a useful gauge of investor sentiment.
ANDREW: One ETF that really stands out here is the BMO MSCI Emerging Markets Index ETF. If we look at a one-year chart, you can see that steady climb.
VALERIE: Exactly. Emerging markets were absolutely on fuego in January and saw incredible inflows. That tells us there was very strong buying interest.
There are two main drivers behind that. First, emerging markets have had a very strong start to the year. Several Latin American markets were up 15 per cent to 20 per cent in January alone, including Colombia and Peru. Some of this is performance chasing — investors want exposure to what’s working.
But there’s also a broader portfolio shift underway. Investors are diversifying away from U.S. mega-cap exposure, potentially due to valuation concerns or a sense that those trades are fully priced. Emerging markets are offering an attractive alternative, and we’re seeing investors follow into that trade.
ANDREW: Valerie, thanks very much for your time. Valerie Grimba, director of global ETF strategy at RBC Capital Markets.
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This BNN Bloomberg summary and transcript of the Feb. 3, 2026 interview with Valerie Grimba 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.
