Why IGM Financial's $284B Asset Surge Isn't a Fluke—Here's How to Play It

The financial services sector is a battlefield of trends, and right now, IGM Financial (IGM.TO) is flexing its muscles like never before. Let's dissect how the company's June 2025 record $283.9 billion in Assets Under Management & Advisement (AUM&A) isn't just a blip—it's a signal of a fundamentally stronger, more resilient business. Here's why this momentum could be just the start of a multiyear story.

The Turnaround in Net Inflows: A Red Flag No More

For years, IGM battled net outflows as investors flocked to passive ETFs and low-cost alternatives. But June 2025 flipped the script: total net inflows hit $190 million, reversing a $302 million outflow in the same period last year. This isn't just a recovery—it's a victory. What's driving it?

• Mutual Fund Sales Momentum: IG Wealth Management's mutual fund net sales jumped to $250 million in May 2025, vs. $127 million in redemptions in 2024. Mackenzie Investments, its asset management arm, saw net sales of $106 million, turning around a $251 million outflow.
• ETFs as Growth Engines: ETF net creations hit $147.6 million, with third-party ETF assets climbing to $8.3 billion—a 5.2% month-on-month spike. This shows clients are embracing IGM's expanded ETF lineup.

The key takeaway? Client confidence is back. Investors are choosing IGM's actively managed products, not fleeing them.

Synergies Between IGWM and Mackenzie: A 1+1=3 Play

The magic happens where wealth management and asset management collide. Here's how IGM's two pillars feed off each other:
- Cross-Selling Power: IG Wealth Management's advisors push Mackenzie's funds, while Mackenzie's institutional sales team taps into IG's 2 million Canadian clients.
- Data-Backed Growth: IGWM's assets under advisement hit $143.7 billion (up 3.3% MoM), while Mackenzie's AUM hit $221 billion (up 3.4% MoM). Combined, they're a $364.7 billion juggernaut—and the numbers keep climbing.

This isn't just about scale. It's about client stickiness. When you're the one-stop shop for advice and investment management, clients don't just stay—they grow their portfolios.

Deferred CGIR Policy: A Gift for Traditional Wealth Managers

The Canadian government's delay in implementing the Client Focused Reforms (CFIR) policy has kept advisors—and their clients—in place. The CGIR rules, which would have forced advisors to shift clients to lower-cost options, are now on hold. This means:
- No Exodus of Assets: Clients stay with their trusted advisors, avoiding a mass migration to robo-advisors or ETF platforms.
- Higher Retention Rates: IGM's high-touch wealth management model (with 2 million clients!) becomes a moat, not a liability.

The Catalysts Ahead: More Than Just AUM Growth

IGM isn't just sitting on its assets. It's using them to fuel the next phase of growth:
1. Wealthsimple's 89% AUA Surge: The digital wealth platform (owned by IGM) now boasts over $43 billion in assets. Its tech-driven model is attracting younger investors, who'll stick around as they grow wealth.
2. Northleaf's Institutional Wins: The private markets firm (a strategic partner) raised $1.8 billion in Q1 2025—its best quarter ever. This feeds into IGM's institutional SMA (separately managed accounts) business, which grew $19.1 million in May alone.
3. Private Asset Play: IGM is doubling down on alternatives like private equity and real estate, which command higher fees and lower volatility.

Risks? Sure—but They're Manageable

• Declining Fee Rates: Adviser fees are projected to drop 0.5 basis points quarterly. But with AUM growing so fast, even smaller margins mean bigger profits.
• Industry Net Redemptions: While IGM is turning inflows positive, the broader market still faces outflows. IGM's diversified platform (mutual funds, ETFs, SMA) gives it a buffer.

Investment Thesis: Buy the Dip, Hold for Dividends

IGM isn't just a play on Canadian wealth management—it's a structural winner in an era of rising asset prices and growing demand for financial planning. Here's how to play it:
- Buy on Weakness: The stock has lagged the S&P/TSX in 2025, but its AUM growth is outpacing peers. A pullback to the $60–$65 range would be a buying opportunity.
- Hold for Dividends: IGM's 3% yield is solid, but its dividend growth is even better. The company has prioritized returns to shareholders, with buybacks and payouts taking precedence over big M&A.

Final Call: This Train Isn't Stopping Anytime Soon

The August 6 Q2 earnings report will put IGM's Q2 results under the microscope. But with AUM&A hitting records and net flows turning decisively positive, this isn't a flash in the pan. IGM's diversified platform, synergized operations, and the CGIR delay's tailwinds make it a must-own name for Canadian financial exposure.

Stay tuned for the August 7 earnings call—we'll know by then if the second quarter's momentum is truly unstoppable. For now? This train's picking up speed.

Disclosure: The author does not hold a position in IGM.TO at the time of writing.