Published: December 2024
The vibrancy of the Canadian alternatives market has never been brighter. Interest and investment in alternative strategies continues to grow across institutional, family office and wealth channels. Canada is proud to boast a consistently growing hedge fund market, now nearly US$138B according to Preqin. Liquid alts, now over CAD $30B in AUM in 5 years, have propelled access for alternatives in wealth channel in a structure that continues to evolve through various exemptive reliefs to best align structures for the strategies.
Global managers are increasingly distributing products not only to institutions, but also now to wealth channels, benefiting investors with additional choice and access to alternatives. The current OSC Long-Term Assets proposal is bound to bring further flexible structures for alternative investments in the future.
All around the globe though, competition for capital, operational costs and regulatory burden are rising for alternative managers. Consolidation too is high, with PwC estimating that half of assets under management will be controlled by 10 firms by 2027. Quebec proudly features a strong emerging manager program supporting new and small managers in the province. As Canada faces an entrepreneurship gap generally, with less than half as many people launching new businesses as they did 20 years ago according to BDC, further programs across the country might help fuel more locally-managed investment funds and position Canadian talent to continue to lead asset management globally for the years to come. AIMA Canada is committed to ensuring a level-playing field where local regulation is consistent globally and Canadian manager access to capital is fair and strong. In our AIMA Canada Vision 2027 for alternatives in Canada, these themes stand out to grow our alternatives market with vibrancy in the short-term future and years to come:
1. Increased emerging asset manager entrepreneur support
This might include further provincial, national and/or independently-run programs or shared services to minimize operational costs of excellence to increase capital allocated to more managers and more funds at home.
2. Improved regulatory alignment with other prominent jurisdictions and structures
This might include improved registration timelines, less prohibitive proficiency requirements, confidential pre-registration, harmonized provincial system, ability to adopt pass-through expenses, codified exemptive relief for NI 81-102 alternative funds.
3. Minimized barriers to wealth channel adoption
This might include improved shelf access for third-party managers and funds of all sizes and track records, risk ratings that align with historical risk-adjusted performance of the fund or strategy, expanded CIFSC alternative fund categories, Client Focused Reforms’ KYP processes that compare longonly and alternative funds, automated solutions that improve workflow efficiency while minimizing paperwork, minimized proficiency requirements.
4. Next generation talent engagement heightened
This might include more next gen talent participating in industry initiatives, improved DE&I practices across firms, high school and university education inclusion to ensure a strong talent pipeline of successors.
5. Alternatives in mainstream media
This might include more features on alternative assets, strategies and managers and more press mentions of AIMA research or thought leaders. In this AIMA Canada Handbook 2024 edition, we’re thrilled to present an overview of the alternative investment landscape in Canada. From investors – institutional, family office and wealth – to alternative asset classes – hedge funds, private credit, digital assets, real estate – and to regulatory highlights, there is a wealth of context shared which will help readers better understand and navigate the local market. The people and community they form here together are the magic behind our alternative investment market in Canada. AIMA Canada is a proud collective of collaborators, who lead together with a unified voice to elevate our industry locally and globally with education, regulatory advocacy and operational sound practice while improving stakeholder investment outcomes. Wherever you are reading this in the world, we hope Canada is a leading destination of choice for you for alternative investments. We look forward to welcoming you here!
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Claire Van Wyk-Allan
Managing Director, Head of Canada and Investor Engagement, Americas
Thank you to all of our esteemed contributors;
- Aaron Goddard, Intellifi
- Adam Dean, CMLS Asset Management
- Anastasia Manolikakis, PwC
- Belle Kaura, Third Eye Capital
- Brian Bridger, Fundata
- Caroline Bergeron, Innocap
- Daniel D’Cruz, Ninepoint
- David Ross, OPTrust
- Eduard van Gelderen, FCLTGlobal
- Kiira Käärid, McMillian LLP
- Kimberley Jansen, BMO Capital Markets
- Lillian Ferndriger, BMO Global
- Melissa Ghislanzoni, BLG LLP
- Melody Chiu, PwC
- Mishall Khan, BLG LLP
- Sadia Quraishi, BMO Capital Markets
- Scott McEvoy, BLG LLP
- Sebastien Davies, AQUANOW
- Tania Boulanger, McMillan LLP
- Tyler Gramatovich, Invico Capital
- Vesna Dragic, RBC Capital Markets
- Yannick Archambault, KPMG Family Ofice
And all of our global sponsoring partners and AIMA Canada members.