Canadian investors increased their exposure to foreign securities by $27.2 billion in February after a $3-billion divestment in January. The rebound in investment was essentially in U.S. shares, according to Statistics Canada data released Thursday.
This included record acquisitions of $29.8 billion of U.S. shares, slightly offset by the sales of $2 billion in non-U.S. shares. Canadian investors also increased their exposure to U.S. government money market instruments and U.S. corporate bonds, while holding fewer U.S. government bonds.
At the same time, foreign investors reduced their holdings of Canadian securities by $6.5 billion in February, the first divestment in 12 months. Foreign investors sold Canadian equity securities and bought debt instruments.
While foreign investors reduced their exposure to Canadian shares by $21.9 billion in February, the highest monthly divestment since October 2007, they increased their exposure to Canadian bonds by $9.9 billion and to Canadian money market instruments by $5.6 billion.
In the Canadian bond market, foreign investors acquired $19.2 billion of corporate bonds and divested from $6.4 billion in federal government bonds and $2.9 billion in provincial government bonds.
These international transactions in securities generated a net outflow of $33.6 billion from the Canadian economy in February.
www.investmentexecutive.com
