Passive versus Active Report (2016)

Key evidence about the competition between passive and active management

This report describes the competitive landscape for passively and actively managed funds over the last ten years in Canada and the United States. In the first six months of 2016, Canadian passive funds increased their market share from 11.9% to 12.9% on the back of a positive flow of over $7 billion. In contrast, Canadian active funds attracted only $1 billion. Over the same period, U.S. passive funds increased their market share from 30% to 32%.

This year to date (YTD), U.S. passive funds have attracted $177 billion, versus outflows of $107 billion for active funds. Since 2007–2008, Canadian passive funds have increased their market share from 4.1% to 12.9% and have attracted $55 billion in net new money, compared to $34 billion for active funds. Since 2006–2007, U.S. passive funds have increased their market share from 16% to 32% and have attracted a $2.5 trillion net money flow, compared to $954 billion for active funds.