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. This means that if stocks are not available at reasonable valuations, fund managers may decide to raise their cash holdings. This number can also fluctuate depending upon the scheme mandate. It has become tougher to stay fully invested in the current market environment, with money chasing select names and pushing up valuations. Holding a high percentage of assets in cash, however, can backfire in a rising market.