Canadian investors continue to sell their holdings of foreign stocks.
According to Statistics Canada, Canadians sold $2.3 billion worth of foreign equities in August, the seventh consecutive month of divestments.
Between January and the end of August, Canadian investors sold a total of $57.6 billion of foreign stocks compared with $71.2 billion of foreign equities purchased during the same period last year.
Most of the foreign stocks sold were done so by businesses, governments, and institutional investors, said Statistics Canada.
However, some foreign stocks were sold by retail investors directly or through mutual funds and exchange-traded funds (ETFs).
The sale of foreign equities, more than half of which were in U.S. stocks, can be attributed to a downturn in global markets.
The American benchmark S&P 500 index is down 22.3% so far this year and in a bear market. The technology heavy Nasdaq index in the U.S. is down 31% year-to-date.
Most of the foreign stock buying by Canadians during 2021 was in large technology companies such as Apple (AAPL), Microsoft (MSFT) and Google (GOOGL), which are among the big decliners this year.
A shift in global currencies this year is also impacting Canadian investors, said Statistics Canada.
The Canadian dollar has fallen from near 80 cents U.S. to under 73 cents U.S. through nearly 10 months of the year as investors flee to the safety of the American greenback amid market volatility.
That means Canadians who bought U.S. equities at their peak last year could have their losses softened when converted to Canadian dollars if they sold when the loonie was at its lows this year.