List of Mutual Fund Houses Holding Over 10% Cash in November 2023
In November 2023, several mutual fund houses strategically maintained cash allocations exceeding 10% of their assets under management (AUM). This deliberate choice aimed to offer flexibility for potential investment opportunities and to tackle unforeseen redemption pressures. Let’s delve into the specifics of these funds and explore the broader context of cash allocations in the mutual fund industry during this period.
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List of Mutual Fund Houses Holding Over 10% Cash in November 2023
Quant Mutual Fund stood out prominently during this period, holding the highest cash allocation among the listed fund houses. With total equity holdings valued at Rs 29,963.88 crore, the fund maintained a substantial cash reserve of Rs 7,006.66 crore, representing an impressive 18.95% of its AUM.
PPFAS Mutual Fund also demonstrated a substantial allocation to cash, holding Rs 7,140.74 crore, or 14.1% of its AUM, against its considerable equity assets totaling Rs 43,487.41 crore. Shriram Mutual Fund maintained a noteworthy 12.04% cash allocation, holding Rs 12.9 crore in cash against its equity assets worth Rs 94.29 crore. Despite its smaller equity base, the fund strategically allocated a significant portion to cash.
Samco Mutual Fund managed an 11.1% cash allocation, with Rs 148.56 crore held in cash against equity holdings valued at Rs 1,190.16 crore. WhiteOak Capital Mutual Fund maintained a cash allocation of 10.57%, holding Rs 524.21 crore in cash against its equity assets valued at Rs 4,434.44 crore.
| Fund House | Equity (In Crore) | Cash (In Crore) | % AUM in Cash |
|---|---|---|---|
| Quant Mutual Fund | 29,963.88 | 7,006.66 | 18.95 |
| PPFAS Mutual Fund | 43,487.41 | 7,140.74 | 14.1 |
| Shriram Mutual Fund | 94.29 | 12.9 | 12.04 |
| Samco Mutual Fund | 1,190.16 | 148.56 | 11.1 |
| Whiteoak Capital Mutual Fund | 4,434.44 | 524.21 | 10.57 |
What are the Cash Allocations Across the Industry?
Beyond these highlighted funds, a spectrum of mutual fund houses maintained varying cash allocations below the 10% threshold. A majority of funds diversified their holdings, with cash allocations ranging between 0.74% to 8.51%. This diversity underscores the different investment strategies adopted by various funds during this period.
What are the Reasons for Holding Cash?
Mutual fund managers strategically retain cash within their portfolios for several reasons. These include ensuring liquidity to meet potential redemption demands from investors, seizing timely investment opportunities arising from market fluctuations, and safeguarding portfolios against unforeseen market risks. The decision to hold cash is part of a prudent risk management strategy, offering flexibility to capitalize on favorable market conditions or navigate market uncertainties.
Conclusion:
The varying cash allocations observed among mutual fund houses in November 2023 reflect the diverse strategies employed by fund managers. While some funds opted for higher cash reserves to prepare for potential market opportunities or redemptions, others struck a balance between cash and equity in line with their portfolio compositions and risk management strategies.
