In 2008, hundreds of billions of dollars were wiped off the balance sheets of Canadian households. At the end of June last year, Canadian households controlled over $2.5 trillion in financial wealth. By year end that number was $300 billion smaller. Of that amount, $161 billion was represented by the decline in the value of assets held in the investment funds industry. The severity of the decline reduced the fund industry’s share of financial wealth to 28% from 31%, a level consistent with that experienced in the 2002 bear market. Although the share of financial wealth was similar in the two periods, the $40 billion decline in investment fund values in 2002 (8.2%) was a far cry from the damage inflicted on investment funds in 2008.
Throughout the research article presented at the beginning of the 2009 Insight Annual Industry Review, we raise a number of questions, some of which we answer and others which we leave to our clients, who make the funds industry the vital and dynamic sector that it is today. The essay concludes by noting that fortitude, hard work, courage, resilience, determination, and endurance will be required by all those in the funds industry in the year ahead.