A report from BMO Global Asset Management (BMO GAM) predicts that exchange traded funds (ETFs) will continue to gain in popularity.

According to BMO GAM's Canadian ETF Outlook for 2015, assets under management in the Canadian ETF industry have grown by 10% since the end of 2014 and now stand at $84 billion; of this year’s net inflows, $4.5 billion went to equity ETFs while $4.7 billion went to fixed income ETFs.

The report goes on to predict that product providers will continue to develop ETFs that are focused on narrower segments of the market, and that ETFs in general will continue to grow thanks not only to their low cost and lack of fee complexity, but also to the fact that large, institutional investors have started to buy more of them for their own portfolios.

"The domestic ETF industry has seen strong momentum in 2015. Its user base has expanded as investors grow more comfortable with these funds," comments Rajiv Silgardo, Co-CEO of BMO Global Asset Management. "ETFs have been able to maintain their popularity and continue to prove to be useful through changing market conditions because of their flexibility and diversification benefits."