Mutual funds increase cash allocation by Rs 10,000 crore to over Rs 2 lakh crore in October

Mutual funds have increased their cash allocation by Rs 10,000 crore on a monthly basis to over Rs 2.09 lakh crore in October compared to Rs 1.99 lakh crore in September. The cash allocation as a percentage of total AUM in the said time period was recorded at 4.94% against 4.92% in September. The equity AUM increased by nearly Rs 1.86 lakh crore to Rs 42.30 lakh crore in the said time period.

At present, there are nearly 48 mutual fund houses in the industry. Of these 48 fund houses, five had over Rs 10,000 crore cash in their respective portfolios, according to the monthly data by ACE MF.

Also Read | MCX, Mazagon Dock, and RIL among top stocks bought and sold by mutual funds in October

ICICI Prudential Mutual Fund had the highest cash allocation in its portfolio of Rs 32,823 crore in October, which was 6.53% of the total AUM. In September, the fund house had Rs 25,571 crore cash in the portfolio and had an equity AUM of Rs 4.70 lakh crore in the same period.

The largest fund house based on assets managed, SBI Mutual Fund, had Rs 31,912 crore cash in its portfolio compared to Rs 31,272 crore cash in September, signalling a marginal increase. The current cash allocation was 4.19% of the total AUM.

PPFAS Mutual Fund had Rs 29,167 crore cash in its portfolio compared to Rs 28,152 crore in September, signalling an increase in the cash allocation.“We continue to look at individual investments on their own merits and will not hesitate to invest if an opportunity looks attractive. As usual, our investment stance does not depend much on the macro-economic situation but is focused on individual companies. We have about 25.31% in cash holdings, debt & money market instruments and arbitrage positions which can be deployed in long-term investments at appropriate levels,” PPFAS Mutual Fund said in its monthly statement.HDFC Mutual Fund and Quant Mutual Fund had around Rs 28,739 crore and Rs 10,366 crore cash in their portfolios respectively. Both the fund houses have also increased their cash allocation on a monthly basis.

Axis Mutual Fund had Rs 8,486 crore cash in its portfolio in the said time period, followed by Motilal Oswal Mutual Fund which had Rs 8,460 crore cash. Kotak Mutual Fund had Rs 5,357 crore cash in its portfolio in October against cash allocation of Rs 6,510 crore in September.

Invesco Mutual Fund had Rs 2,839 crore cash in its portfolio. “We generally do not take cash calls under most market circumstances. Even in the height of Covid, if I recollect, we were probably fully invested. So, we typically, as a housekeeping rationale, ensure that we generally do not have more than 5% cash in our portfolios. It will be, on average, most times that you speak to me, probably more in the vicinity of 2% to 3% if at all. So, we prefer to be fully invested and try and identify good ideas and try to put investors’ money to work,” Taher Badshah, Invesco Mutual Fund told ET Now.

Also Read | Diversification over gold? Mutual fund investors picking multi-asset fund over gold ETFs

Mirae Asset Mutual Fund had Rs 1,858 crore cash in its portfolio. Around 26 fund houses had less than Rs 1,000 crore cash in their portfolios, of which 11 had less than Rs 100 crore cash.

Radhika Gupta-led Edelweiss Mutual Fund had Rs 876 crore and Mahindra Manulife Mutual Fund had Rs 813 crore cash in their portfolios. Old Bridge Mutual Fund had Rs 163 crore in the portfolio in the said time period.

Samir Arora-led Helios Mutual Fund had around Rs 68.95 crore cash. Arora told ET Now last month that, “We do not hold any cash mostly at any point. Today our cash, I do not know about the mutual funds exactly very recently, but generally they will be holding half a percent, 1%. I do not hold any cash because I am long-short. So, my book is more than 100. So, I am always borrowing from the futures market in the sense that because I buy futures for a small part, that means I am actually never having cash. Cash is not part of the game.”

JioBlackRock Mutual Fund, the latest entrant in the mutual fund market, had Rs 53.92 crore cash in its portfolio which was 2.28% of the total AUM. The fund house had an equity AUM of Rs 2,312 crore as on October 31, 2025.

The Wealth Company Mutual Fund, led by Madhu Lunawat, had Rs 48.04 crore cash in its portfolio.

Shriram Mutual Fund and Angel One Mutual Fund had Rs 5.41 crore and Rs 0.16 crore cash in their respective portfolios.

Fund managers are allowed to keep a part of their portfolio in cash to meet events like redemptions or make investments when they see a possible opportunity in the market.