AGF Management reported $74.2 billion in assets under management and fee-earning assets for the third quarter of fiscal 2026, up 31% from a year earlier. The Canadian asset manager also reported $38.9 million in quarterly free cash flow and continued expansion in ETFs and separately managed accounts as investors increasingly favor flexible, digitally distributed investment products.

AGF Management is closing the first three quarters of fiscal 2026 with a larger asset base and stronger cash generation, while its product mix continues to shift toward exchange-traded funds and separately managed accounts.

The Canadian asset manager reported $74.2 billion in assets under management and fee-earning assets as of August 31, 2026, compared with $56.8 billion a year earlier and $74.7 billion at the end of the previous quarter. Free cash flow reached $38.9 million, a 27% increase from $30.6 million in the comparable quarter of 2025.

The headline AUM number, however, does not tell the entire story. AGF’s underlying product mix shows a continued move beyond traditional mutual funds.

ETF and separately managed account AUM reached $5.48 billion, up from $3.49 billion a year earlier. That represents an increase of roughly 57% over the period. Canadian ETF and SMA net sales were $179 million in the latest quarter, compared with $47 million in the same quarter last year.

AGF also launched ETF series units for the AGF Enhanced U.S. Income Plus Fund, expanding its ETF lineup. The company said demand remained strong across its ETF and SMA offerings, while its U.S. Large Cap Growth Strategy was added to a U.S. advisory platform, broadening access to the strategy through separately managed accounts.

That product shift reflects a broader change in asset management. ETFs increasingly function not simply as low-cost passive vehicles but as distribution wrappers for active strategies, income products and portfolio solutions.

McKinsey’s 2025 asset-management research identified the rapid growth of active ETFs as one of the industry’s major structural changes. More than 1,400 active ETFs launched over the previous five years, according to the firm’s analysis, while active ETFs accounted for 37% of ETF flows in 2024 despite representing only 7% of overall ETF assets.

For firms such as AGF, the significance extends beyond product design. ETFs and SMAs can provide access to different advisor channels, portfolio platforms and digitally enabled investment models, creating additional routes for asset managers to distribute investment capabilities.

Traditional mutual funds remain the largest component of AGF’s business. Mutual fund AUM stood at $37.5 billion at the end of August, compared with $33.0 billion a year earlier. But quarterly mutual fund net sales were negative $30 million, while Canadian retail net flows across mutual funds, ETFs and SMAs totaled $271 million.

The distinction illustrates why asset managers are increasingly measuring growth across product structures and distribution channels rather than relying solely on conventional mutual-fund sales.

AGF’s financial results also show the effect of its broader business portfolio.

Net management, advisory and administration fees rose to $101.0 million, from $88.8 million a year earlier. Adjusted EBITDA increased to $48.8 million from $46.2 million, although it declined from $64.1 million in the preceding quarter. Adjusted net income attributable to equity owners was $32.0 million, compared with $31.2 million a year earlier and $46.9 million in the second quarter.

AGF Capital Partners was a significant variable in the quarter. Its AUM reached $13.5 billion, compared with $2.5 billion a year earlier. The company said adjusted EBITDA from the business was $8.5 million, down from $21.5 million in the previous quarter, partly because the prior period included a $14.7 million gain associated with the NHC transaction.

That makes the quarterly earnings comparison somewhat more complicated than the AUM trajectory. AGF’s asset base has expanded, but the contribution from different business lines can vary considerably from quarter to quarter.

The wider asset-management industry is facing a similar tension between growth and operating economics.

McKinsey reported that global assets under management reached a record $147 trillion by June 2025, but rising assets did not translate proportionally into profitability. The firm’s research highlights growing technology, distribution and investment-management costs and argues that firms need more scalable operating platforms to restore leverage.

Technology is becoming particularly important as asset managers support more products, investor segments and personalized portfolios. McKinsey estimates that technology costs across the asset-management industry rose 9% in 2024, while firms increasingly look toward AI and platform modernization to improve productivity.

For AGF, the ETF and SMA expansion fits into that broader operating-model transition. ETFs can be distributed through established brokerage and advisory infrastructure, while SMAs provide portfolio-level customization that increasingly complements wealth-management platforms.

AGF is also expanding its private-markets capabilities. During the quarter, Kensington Capital Partners, an affiliate manager of AGF Capital Partners, appointed Saar Pikar and Bogdan Cenanovic to its senior leadership team following a global search. The appointments are intended to strengthen the business as it develops its next phase of growth.

That combination of public-market investment management, private markets, wealth management and alternative products reflects another major industry trend: the convergence of traditional and alternative asset management.

McKinsey estimates that the convergence of public and private markets, the growth of active ETFs and changing geographic investment preferences could collectively put $6 trillion to $10.5 trillion of assets in motion over five years.

For asset managers, that creates a competitive environment in which distribution technology can be as important as investment capabilities. Advisor platforms, model portfolios, ETFs, SMAs and digital client engagement increasingly determine how investment products reach end investors.

AGF’s third-quarter results therefore provide a snapshot of that transition. Its overall asset base remains substantially higher than a year ago, free cash flow has strengthened, and ETF and SMA assets are growing faster than the company’s traditional mutual-fund base.

The next phase will depend on whether those newer distribution channels can generate durable flows and operating leverage while AGF continues investing across public and private markets.

Market Landscape

Asset management is experiencing a structural shift toward active ETFs, customized portfolios, alternatives and digitally enabled distribution. McKinsey reported global AUM of $147 trillion by June 2025, while highlighting persistent margin pressure and rising technology costs.

Active ETFs are particularly relevant to AGF’s product strategy. McKinsey found that active ETFs represented only 7% of overall ETF AUM in 2024 but captured 37% of ETF flows, reflecting growing demand for active strategies delivered through an exchange-traded structure.

AGF’s ETF and SMA AUM increased from $3.49 billion to $5.48 billion year over year, while Canadian ETF and SMA net sales reached $179 million in the third quarter.

Top Insights

• AGF reported $74.2 billion in AUM and fee-earning assets, up 31% from $56.8 billion a year earlier.
• ETF and SMA AUM climbed approximately 57% year over year to $5.48 billion, highlighting continued product diversification.
• Free cash flow increased 27% year over year to $38.9 million in the third quarter.
• McKinsey says active ETFs captured 37% of ETF flows in 2024 while representing 7% of ETF AUM.
• AGF’s net management, advisory and administration fees rose 14% year over year to $101 million.

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