Five of the top 10 mutual funds by equity value are holding cash in the range of 8-11 per cent, a reasonably high number. Equity funds typically hold cash amounting to 1-5 per cent of the scheme’s assets, and raise their cash exposure when they expect the market to fall, or when the risk-reward situation is not favourable. It might go against the fundamental tenet of staying invested at all times, but is a strategy employed by fund managers to either protect the downside in the event of a market fall or to avoid paying a high price for a stock.
Nine big financial changes that you must watch out for in October
Read More
