Nervous clients of IGM Financial Inc. IGM-T have taken a pause on adding to their portfolios but are steering clear of panic-selling, the investment giant’s chief executive officer says.
Investors poured $4.2-billion into IGM Financial’s funds for the first three months of 2025, according to figures reported Thursday, compared with just $128-million for the same period last year.
But sales started to slow down in the spring, as market uncertainty began to weigh on investor confidence, CEO James O’Sullivan told analysts during an earnings call on Friday morning. Second-quarter figures are expected to be released in the summer.
“While much of the first quarter was characterized by considerable uncertainty, the financial markets – for the most part – proved resilient until early April when we saw a spike in volatility," he said.
However, net redemptions – the amount of money investors pull out of funds – has remained stable, he added, but the industry has seen sales softened slightly.
Mr. O’Sullivan, later speaking to shareholders at IGM Financial’s Friday annual general meeting, addressed the current economic climate that has started to rattle clients.
“In the last few months, we have been compelled to re-examine our relationship with the U.S. as a result of the launch of a tariff war and the questioning of our national sovereignty,” he said.
“We have also seen the beginnings of a restructuring of global alliances that have been in place for 80 years. All this, naturally, has created a degree of stress in our economy and resulting market volatility.”
However, that uncertainty has led investors to seek out more financial advice, as they hold steady in their investment decisions: “It is a positive time for investment advisers.”
IGM Financial reported adjusted net earnings of $237-million, or $1.00 a share, for the first quarter of 2025, compared with $224-million, or 94 cents a share, in 2024.
The investment giant, a subsidiary of Power Corp. of Canada POW-T, has seen its assets under administration – including its strategic investments – reach an all-time high of $503.6-billion, up from $483-billion, at the end of 2024.
In recent years, the company has completed a flurry of acquisitions. Today, IGM Financial owns a 20.5-per-cent stake in U.S wealth giant Rockefeller Capital Management and a 56-per-cent stake in private equity firm Northleaf Capital Partners.
In 2022, IGM Financial doubled its stake in China Asset Management Co. to 27.8 per cent from 13.9 per cent, and it continues to hold nearly 25 per cent in digital manager, Wealthsimple Inc.
Mr. O’ Sullivan said there are times where Canadians want less financial advice, where “they want do it themselves a little more.” But during other market events, Canadians seek direction.
“Markets today are where Canadians want to speak to someone directly to get advice.”
That is good news for a financial services giant with multiple layers of advice businesses. Digitally savvy investors are turning to Wealthsimple, which now serves more than two million clients. Its assets skyrocket to $73-billion, as of March 31, up from $31-billion at the end of 2023.
“Wealthsimple is the most successful customer acquisition engine that has ever been built in this country,“ Mr. O’Sullivan said in an interview. ”It’s a company the banks in particular are going to find hard to compete with.”
But most of IGM Financial’s revenue comes from IG Wealth (formerly known as Investors Group), which has more than 3,200 financial advisers and associates. IG Wealth reported client sales of $718-million, compared with $46-million in the first quarter of 2024.
Unlike other periods of market uncertainty where several asset classes and sectors of the stock markets would decline simultaneously, Mr. O’Sullivan says today’s environment is well tuned for active manager who can diversify.
“We’re finally in a market where diversification is really working for client portfolios – by geography and by currency – and it’s actually worked out really well so far. Clients are nervous, but they’re not panicking.”