FidelityConnects · Sep 30, 2026 · recorded Sep 8, 2026 · 28m · 15m saved
With Andrew Clee, Vice President, Product and Managed Accounts at Fidelity Investments Canada
Taiwan Semiconductor, Samsung and SK Hynix are the three largest companies in the emerging-markets index and make up about 28% of it, according to Andrew Clee.
About two-thirds of the money going into Canadian ETFs buys passive funds, which hold whatever the index holds. Clee said that is a risk when all three of those companies ride on AI spending and a single tweet or a guidance cut can move a stock 20% in a day.
"So the rise of the direct investor is coming into a passive trade that's so interconnected to tech companies that are AI-adjacent but may not be chip companies — these passive indices cannot get out of the way." — Andrew Clee
Andrew Clee, vice president of product and managed accounts at Fidelity Investments Canada, on FidelityConnects, has worked on ETFs for 15 years and tracks where Canadian fund and ETF money goes. By his count, Fidelity has taken about 82% of mutual fund industry flows over the last 12 months or so.
The full interview is covered here so you can skip it. 28 minutes of audio, 13 minutes of reading.
Here are the 12 insights that matter.
Key Takeaways
Canadian mutual funds and ETFs are both on pace for record years, while in the US ETFs are pulling money out of funds
Two or three firms take most mutual fund flows in Canada, and Fidelity's share is about 82% by Clee's last check
The rise in the 30-year yield signals worry about government debt, and a doubled US bond buyback calmed it for about a day
The oil spike is still temporary inflation; it becomes lasting inflation only if it pushes wages up, as in 2022
Bitcoin has about 20% correlation with stocks over three years, far from the 70% Clee treats as significant
Three chip and memory stocks are about 28% of the emerging-markets index, down from a peak near 35%
In the US, AI-related names are about 25% of the index's top 10
The 30-year yield is at its highest since 2007, which Clee said is why the All-in-One portfolios manage bonds actively
1. Record Years for Funds
The host said Canada's mutual fund and ETF industries were both on pace for record years, probably the third banner year in a row. Clee said that shows how much money was waiting on the sidelines.
Both sides of the Canadian industry are growing, which is not what is happening in the US
"So, right now in the US, the ETF industry is sucking a lot of money out of the fund industry, but Canadians are big savers." — Andrew Clee
He pointed to Canada's large market for GICs, the guaranteed investment certificates banks sell, and to cash deposits that grew during the pandemic.
Mutual fund flows are concentrated in a few firms
About seven firms take the bulk of ETF flows, he said, against probably two or three in mutual funds.
"And I think our capture rate over the last 12 or so months, last time I checked, was about 82% in the funds industry, that is, the mutual funds." — Andrew Clee
He said the ETF side has more breadth, while a few players, Fidelity among them, are driving the success of mutual funds.
