IGM Financial’s Record AUM Growth: A Catalyst for Long-Term Shareholder Value?

In the fiercely competitive Canadian wealth management sector, IGM Financial Inc. (IGM) has emerged as a standout performer, with assets under management (AUM) surging 12.4% year-over-year in 2025. This growth, driven by robust net inflows and strategic expansion across its IG Wealth and Mackenzie segments, raises a critical question: Does IGM’s outperformance signal a sustainable competitive advantage in a market where the sector-wide AUM growth rate is projected at a modest 0.52% CAGR from 2024 to 2028 [2]?

Market Context: A Sector at a Crossroads

Canada’s wealth management industry is navigating a dual challenge: moderating growth in traditional asset classes and intensifying competition from fintech disruptors and alternative investments. According to the PwC 2024 Asset & Wealth Management Report, global AUM is expected to grow at a 5.9% CAGR through 2028, but Canada’s domestic market lags significantly, with AUM expanding from $178.0 million in 2022 to $180.4 million in 2023 [3]. This stagnation is attributed to a decline in client households and the brokerage channel’s struggles to retain high-net-worth clients [3]. Meanwhile, alternative assets—private equity, hedge funds, and tokenised investments—are gaining traction, growing at a 6.7% CAGR globally [1].

IGM’s Outperformance: A Closer Look

IGM’s 12.4% YOY AUM growth in 2025 starkly contrasts with the sector’s tepid trajectory. The company’s Q2 2025 results underscore this momentum: adjusted EPS hit a record $1.07, up 15% year-over-year, while IG Wealth’s AUM&A reached $146.7 billion, a 13% increase [3]. Mackenzie Investments, a key pillar of IGM’s asset management division, reported a record $213 billion in AUM, up 9% year-over-year [1]. These figures reflect not only strong organic growth but also strategic bets on high-growth areas like private equity (via Northleaf Capital, which raised $4.9 billion in 2024) and digital platforms (Wealthsimple’s valuation surged 21% to $1.5 billion in Q2 2025) [3].

Competitive Benchmarking: IGM vs. Peers

To assess the sustainability of IGM’s growth, it is essential to compare its performance with key rivals:
1. Onex Corp (ONEX): A leader in alternative assets, Onex reported 16% growth in fee-generating AUM in 2025, driven by its credit and private equity divisions [4]. However, IGM’s diversified model—spanning wealth management, asset management, and private equity—provides broader resilience against sector-specific volatility.
2. CI Financial (CIX): CI’s AUM grew 12.6% year-over-year, but its Q2 2025 results revealed a 2.0% decline in asset management fees due to lower average AUM [5]. This highlights IGM’s stronger operating leverage, with net income growth outpacing revenue fluctuations.
3. Sprott Inc (SII): Sprott’s AUM surged 27% year-over-year in Q2 2025, fueled by rising precious metals prices and inflows into physical trusts [6]. While impressive, Sprott’s niche focus on commodities exposes it to market-specific risks, whereas IGM’s diversified portfolio offers more balanced growth.

Strategic Advantages: Technology and Diversification

IGM’s competitive edge lies in its dual focus on technological innovation and strategic diversification. The company has invested heavily in AI-driven platforms to enhance client engagement and operational efficiency, aligning with PwC’s industry-wide emphasis on digital transformation [1]. Additionally, IGM’s exposure to alternatives—via Northleaf and its tokenised investment initiatives—positions it to capitalize on the 51% CAGR projected for tokenised funds by 2028 [1].

Analysts at Barclays, while maintaining an “underweight” rating on IGM, acknowledge its strong net inflows and operating margins as positives [7]. However, they caution that trade tensions between the U.S. and Canada could dampen long-term growth [5]. This underscores the need for IGM to sustain its innovation momentum while mitigating geopolitical risks.

Conclusion: A Sustainable Edge?

IGM’s 12.4% YOY AUM growth is a testament to its ability to outperform a stagnant sector and rival peers. Its diversified business model, technological agility, and strategic investments in alternatives create a compelling case for long-term shareholder value. However, the sustainability of this growth hinges on maintaining net inflows, navigating macroeconomic headwinds, and continuing to innovate in a rapidly evolving landscape. For investors, IGM’s trajectory suggests a company not just riding a wave, but actively shaping the future of Canadian wealth management.

Source:
[1] PwC 2024 Asset & Wealth Management Report, [https://www.pwc.com/gx/en/news-room/press-releases/2024/pwc-2024-asset-and-wealth-management-report.html]
[2] Wealth Management - Worldwide, [https://www.statista.com/outlook/fmo/wealth-management/worldwide]
[3] IGM Financial Inc (IGIFF) Q4 2024 Earnings Call Highlights, [https://finance.yahoo.com/news/igm-financial-inc-igiff-q4-070635587.html]
[4] Earnings call transcript: Onex Corp Q2 2025 sees strong asset growth, [https://www.investing.com/news/transcripts/earnings-call-transcript-onex-corp-q2-2025-sees-strong-asset-growth-93CH-4178127]
[5] CI Financial Reports Financial Results for the Second Quarter of 2025, [https://ir.cifinancial.com/news/news-details/2025/CI-Financial-Reports-Financial-Results-for-the-Second-Quarter-of-2025/default.aspx]
[6] Sprott Announces Second Quarter 2025 Results, [https://sprott.com/investor-relations/press-releases/sprott-announces-second-quarter-2025-results/]
[7] Monday's analyst upgrades and downgrades, [https://www.theglobeandmail.com/investing/markets/inside-the-market/article-mondays-analyst-upgrades-and-downgrades-for-jan-23/]