Exchange-traded funds are seeing record levels of trading activity as investors respond to volatility and shifting global themes.
BNN Bloomberg spoke with Kristy Akullian, head of iShares investment strategy for the Americas at BlackRock, who highlighted three Canadian-listed ETFs offering exposure to U.S. equities, income strategies and emerging markets.
Key Takeaways
- ETFs accounted for roughly 40 per cent of U.S. stock trading in March, reflecting strong demand for liquidity and flexibility.
- Investors are increasingly using ETFs to reposition portfolios quickly during periods of geopolitical uncertainty and volatility.
- U.S. equities continue to show resilience, with earnings estimates rising and valuations easing below five-year averages.
- Income-focused strategies are gaining traction as interest rate expectations stabilize and investors prioritize yield over capital gains.
- Emerging markets offer exposure to AI-driven growth and diversification, though higher energy prices pose near-term risks.
Read the full transcript below:
ANDREW: Time for the ETF report. We’re going to zero in on three Canadian ETFs, and we’re talking to a major provider of ETFs in Canada. We’re joined by Kristy Akullian, head of iShares investment strategy for the Americas at BlackRock, a major global player in ETFs. Thanks very much for joining us.
KRISTY: Of course. Thank you for having me.
ANDREW: Just give us an idea of the scale of the ETF business in Canada or the U.S., and the amount of trading, for example, that goes on through ETFs these days.
KRISTY: Yeah. As you noted, ETFs are enormous globally. A couple of stats that I found interesting, even just from some of the recent geopolitical tensions and uncertainty in markets — one of the things we focus on is the scale of ETF trading relative to the entire stock market.
Here in the U.S., we’ve had the largest month on record so far in March, with one day left to go. About $4 out of every $10 traded in the U.S. stock market changed hands via ETFs. So we’re seeing an enormous amount of trading as investors reach for this vehicle in their portfolios that is liquid, efficient and allows them to adjust to changing market conditions quickly.
ANDREW: And how long have you been offering ETFs in Canada?
KRISTY: Well, the first ETF ever was launched in Canada, and at BlackRock, we have a long history going back decades of offering ETFs here as well.
ANDREW: Right. Let’s talk about a couple of your products. There’s XUS — the iShares Core S&P 500 Index ETF. Is this a popular product with investors? What can you tell us about it?
KRISTY: Yeah, absolutely. This is a standard building block in many investor portfolios, given that it provides core exposure.
Right now, markets are fairly uncertain given the conflict in the Middle East and higher oil prices, and what that could mean for the global economy. But we are seeing relative strength in U.S. equities. In fact, earnings estimates have been revised higher over March, despite that volatility and uncertainty.
I would characterize us as tactically cautious, but structurally more positive. Some of the decline in prices alongside stronger earnings has brought price-to-earnings multiples below their five-year average in the U.S. That addresses some of the valuation concerns investors had coming into the year, while earnings growth remains strong.
This can complement Canadian equity exposure, which many investors already hold, by adding more growth-oriented exposure.
ANDREW: Right. So this one tracks the S&P 500. It’s huge — the latest number I have is nearly $11 billion — and about 32 per cent is in information technology. Let’s move on to XFLX, the iShares Flexible Monthly Income ETF, which is hedged to Canadian dollars. Who is this aimed at?
KRISTY: This is for investors looking for income. When we think about fixed income right now, we are more focused on income than capital appreciation. We don’t expect rates to come down significantly, so income is more reliable in an uncertain environment.
What XFLX does is focus on sectors of the fixed income market that may be harder for investors to access directly — things like global credit, securitized assets and asset-backed securities. It also actively manages duration risk.
What’s compelling about this fund is that it can complement core bond holdings. It’s actively managed, reaches into harder-to-access areas of the market, and is designed to generate income while managing risk.
ANDREW: Right. And a lot of it is in U.S. and non-U.S. credit — about 17 per cent — and the trailing yield is about 5.7 per cent.
KRISTY: Yes, that’s correct. The yield will move somewhat because it is actively managed by Rick Rieder, our global CIO for fixed income. But again, the focus is on income and complementing core bond exposure.
ANDREW: Let’s look at the final one — XEC, the iShares Core MSCI Emerging Markets ETF. Higher energy prices are generally negative for global equities, but who is this fund aimed at?
KRISTY: You’re right — some caution is warranted, especially given how higher energy prices can affect parts of the emerging markets universe, particularly in Asia.
However, what has supported emerging markets over the past year is strong earnings growth tied to the AI theme. For investors who want exposure to AI but are concerned about concentration in U.S. indices, emerging markets offer an alternative.
Countries like Korea and Taiwan are deeply involved in AI-related manufacturing, and that has translated into strong earnings growth — even higher than in the U.S.
So while near-term caution is warranted, longer term, emerging markets offer exposure to AI at lower valuations and add diversification beyond North American equities.
ANDREW: Thank you very much, Kristy. Really appreciate it. Kristy Akullian, head of iShares investment strategy for the Americas at BlackRock.
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This BNN Bloomberg summary and transcript of the March 31, 2026 interview with Kristy Akullian 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.
